Americans Tighten Their Belts as Grocery Bills Bite and Restaurant Visits Vanish
Consumers can’t afford food, so they’re stuck eating FUD — Fear, Uncertainty, and Doubt — for breakfast, lunch, and dinner. A new era of financial anxiety has gripped the nation, forcing people to rethink every purchase, from the grocery aisle to evening take-out.
Pennies pinched: Consumer spending slowed in May, according to federal data — with 69% of people expecting to eat more at home, per KPMG’s Consumer Pulse Summer 2025 report. Small-business restaurants saw month-over-month sales decline 5.6% and 2.5% in the past two months, and earnings results from major chains paint a similar picture of strained households.
- Yesterday, Yum! BrandsYUM reported weaker-than-expected growth at Taco Bell and KFC, while Pizza Hut posted its seventh consecutive quarter of same-store sales declines.
- Even ChipotleCMG, which dodged a broader industry slowdown last year, recently logged its second straight quarter of same-store sales decline.
Recipe for a Recession
The cutbacks don’t stop at dining out. A staggering 53% of Americans say rising grocery costs are a major source of stress, as the prices of everyday items like beef hit record highs. Another recent survey by Morning Consult showed that 15.6% of adults experienced food insecurity, nearly double the rate in 2021.
- Mondelez International’s CEO flagged “a lot of consumer anxiety,” while Procter & Gamble’sPG CFO Andre Schulten said spending is “consistently decelerating” across all income levels.
- The desperation has pushed 14% of adults to use Buy Now, Pay Later plans for groceries, with 11% using them for restaurant meals.
Reality check: Corporate America is overhauling its strategies as the spending slowdown sends shockwaves through the market. KrogerKR reported shoppers are making more frequent trips but buying less per visit, while generic brands are flying off the shelves. Domino’sDPZ and other chains are increasingly offering value deals, while cheaper proteins like chicken are gaining ground with budget-conscious buyers. For both brands and consumers, the end is nowhere in sight. With household budgets stretched to the brink, FUD remains the main course for the entire industry.