More than two-thirds of business owners say customers are ordering less, see less value in their meal, or are upset by costs
Independent restaurants are woven into the fabric of American life. They bring us together, create jobs, and fuel local economies. But behind the scenes, the business owners who run these vital institutions are facing unprecedented uncertainty — and too many are being pushed to the brink.
New research from the Independent Restaurant Coalition (IRC) and Chase lays out the stark reality. Despite driving $3.53 trillion in total economic output in 2024 and employing 1 in 10 American workers, independent restaurants are being squeezed on every side. Through surveys of 1,500 independent restaurant owners and in-depth interviews with 20 of them, the report shows that unstable labor markets, unpredictable supply chains, and shrinking consumer demand are making it harder for independent restaurants to keep their doors open and serve their communities.
Independent restaurants do more than serve meals. One in three Americans find their first job in a restaurant (Source: LETO Campaign, 2020). According to this survey, 79% of owners have children under the age of 18 — and many of their workers do too (Source: IRC & Chase Independent Restaurant Report, 2025). They employ women and people of color at higher rates than nearly any other industry (Source: NRA Restaurant Employee Demographics Brief, 2022). They give neighborhoods identity. They step up when disaster strikes. And yet, they face a business environment so volatile that staying open takes heroic effort.
About 9 in 10 independent restaurant owners surveyed report raising menu prices to cope with the increased cost of doing business (Source: IRC & Chase Independent Restaurant Report, 2025). Customers are increasingly eating out less: Nearly 1 in 3 Americans said they did not plan to eat at a restaurant in the next week — the highest rate since early 2021 (Source: CivicScience, October 2024). If these trends continue, many neighborhood restaurants are at risk of closing their doors.
Here’s what else we learned from business owners:
Rising Operating Costs are Pushing Businesses Into the Red
- Restaurant operating costs now average 92.5% to 101.2% of total revenue — meaning many restaurants are operating at a loss before taxes. (Source: IRC & Chase Independent Restaurant Report, 2025)
- Since 2019, retail food rates have risen at a higher rate than the Consumer Price Index. The cost of eggs, bread, and sugar alone have risen more than three times the average CPI (Source: Federal Reserve Bank of St. Louis, Dec 2019–2023).
- Property insurance premiums have risen every quarter for nearly five years (Source: The Council of Insurance Agents and Brokers, Q4 2023)
- Nearly 9 in 10 business owners report that insurance costs, utilities, and third-party app fees have surged (Source: IRC & Chase Independent Restaurant Report, 2024).
Supply and Labor Shortages are Raising Costs and Slowing Service
- One in four independent restaurant owners ranked supply chain issues among their top five business challenges (Source: IRC & Chase Independent Restaurant Report, 2025).
- Nearly all business owners report delays or shortages of key items (Source: NRA, Supply Chain Shortages Report, 2022).
- 45% of restaurants say they need more staff to meet demand (Source: NRA, State of the Restaurant Industry 2024).
- 88% would hire if they could find qualified applicants (Source: NRA, State of the Restaurant Industry 2024).
Customers are Cutting Back, Tipping Less
- In late 2024, nearly 1 in 3 Americans said they did not plan to eat at a restaurant in the next week — the highest rate since early 2021 (Source: CivicScience, October 2024).
- More than two-thirds of business owners say customers are ordering less, see less value in their meal, or are upset by costs (Source: IRC & Chase Independent Restaurant Report, 2025).
- 83% of independent restaurant owners say customers are tipping less than or the same as last year (Source: IRC & Chase Independent Restaurant Report, 2025).