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Jan 20, 2026

Forks, Knives, and Economic Clues

Let’s review one narrow economic indicator that provides a useful, though not standalone, measure of the overall economy’s health.

The US Census categorizes it as ‘food services and drinking places.’ That can best be described as restaurants and bars.

When the economy is riding high, most people feel optimistic and are more inclined to make discretionary purchases—non-essential items or services. This would include eating out.

As highlighted in Figure 1, eating out has far outpaced grocery purchases over the last four years. Notably, the upbeat pace has continued in recent months, suggesting an expanding economy.

One drawback in Figure 1 is that it’s not adjusted for inflation. Plus, restaurant inflation has outpaced overall inflation, as measured by the US BLS’ Consumer Price Index. Gains may simply be due to rising menu prices.

Figure 2 attempts to adjust for inflation by comparing the annual change in sales at restaurants with the annual change in the CPI for eating out. Given that adjustment, sales are outpacing inflation in all but two months.

This is not a sign of economic weakness, despite sluggish hiring and consumer confidence surveys that reflect a gloomy mood. If economic anxiety were a big concern, we’d probably see weakness in this indicator, like fewer trips out or people switching to cheaper restaurants.

That’s not the case.

As with any anecdotal measures of economic activity, it must be paired with broader economic reports. Today, most economic data is signaling an expanding economy.

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Reproduction Prohibited without Express Permission. Copyright FDP Wealth Management. All rights reserved. Advisory Services offered through FDP Wealth Management, LLC, a state Registered Investment Adviser and Valmark Advisers, Inc. a SEC Registered Investment Advisor. Securities offered through ValMark Securities, Inc., Member FINRA/SIPC. 130 Springside Drive, Suite 300, Akron, OH 44333-2431 800.765.5201 Prosperity Partners and FDP Wealth Management, LLC are separate entities from ValMark Securities, Inc. and Valmark Advisers, Inc. Prosperity Partners, FDP Wealth Management, LLC, ValMark Securities, Inc., Valmark Advisers Inc., and their representatives do not offer tax advice. You should consult your tax professional regarding your individual circumstances. Indices are unmanaged and cannot be invested directly in. Past performance is not a guarantee of future results.

Indices are unmanaged and do not incur fees, one cannot directly invest in an index. You should consult your tax professional regarding your individual circumstances. This information is provided by Financial Jumble, LLC. Financial Jumble, LLC is a separate entity from ValMark Securities, Inc. and ValMark Advisers, Inc.
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