The economy really began to reopen in March, and restaurants led the way.
The US economy added 916,000 jobs in March, trouncing economic forecasts that predicted that number would look more like 660,000 jobs. The leisure and hospitality industry not only drove nearly all of February's jobs gains, it accounted for roughly one-third of March's upswing. With 280,000 payroll additions last month, it added more jobs than any other sector.
Leisure and hospitality consists of arts, entertainment, and recreation, ranging from performing arts and museums to amusement parks. It also includes accommodation and food services, which contributed to 215,000 of the sector's added payrolls in March. Food services and drinking places fueled most of these additions, with 175,000 new jobs alone. It's becoming clear that eating out will be very important for the economic recovery.
While restaurants made huge job gains last month, the sector will also need Americans willing to spend on dining out for its recovery — along with that of the wider American economy.
Americans seem to have already started doing that. For the seven days ending March 27, spending on restaurants and bars was up a whopping 200% year-over-year, per Bank of America card data. The more representative two-year change still showed an 11.9% increase. Overall, BofA found total card spending up 82% year-over-year and up 20% over two years for the period, signaling that trillions of federal stimulus are working.
Of course, with restaurants come things like avocado toast, a luxury long used as a metaphorical stick to beat the millennial generation with, perpetuating the narrative that this frivolous generation isn't focused on the right things financially. While that's not quite true, it is the case that millennials ate out more and spent more eating out than any other generation prior to the pandemic. They're on track to be the biggest food and beverage spenders by 2030.
High-earning millennials saw a lot of excess cash build up in their savings accounts during the pandemic. That puts them in prime position to cash out on a favorite experience they've been deprived of for a year.
They've already begun fueling New York City's indoor dining scene when restrictions were lifted and splurged while doing so. Millennials shelled out for high-priced items like steak, wine, and tasting menus, sending check averages and tips on the climb, Bloomberg's Kate Krader reported.
It turns out the economic reopening — and recovery — will taste like avocado.
