---
title: "Consumer buying power is decreasing right now"
url: https://burnaze.com/article/a5ffbc6b-5cdc-4c16-8459-3bdb9d4c3cfb
source: "Restaurant Business"
original_url: https://restaurantbusinessonline.com/financing/consumer-buying-power-decreasing-right-now
category: "Restaurants"
industry: "Restaurants"
published: 2026-10-15T14:18:27.000Z
modified: 2026-10-31T14:58:05.049Z
image: https://cdn.informaconnect.com/platform/files/public/2026-10/background/Economy%20uncertainty%20shutterstock.jpg?VersionId=xGrF1rCxYkfT6xY9WWwcRt5kJYyAEbJL
---

# Consumer buying power is decreasing right now

**TL;DR:** Consumer buying power has decreased by 0.7% as inflation outpaces wage growth, with lower-income households being the most affected. Restaurant sales have seen relatively strong growth, but the fast-food sector is not benefiting from this trend.

*originally published in Restaurant Business on 2026-10-15. [Read the original](https://restaurantbusinessonline.com/financing/consumer-buying-power-decreasing-right-now).*

## Story

A lot of economic data has come out in the past couple of days, most of which is not good.

On Thursday, for instance, U.S. Census data found relatively strong growth in September restaurant sales, which are up 1.1% from August, and 7% compared with the same month a year ago.

Restaurant and bar sales year to date are up 4.2% compared with a year ago, proving that the industry remains relatively resilient.

But that spending growth is clearly concentrated in certain types of restaurants and chains, because the fast-food business isn’t getting much benefit.

Quick-service restaurant sales rose just 0.6% last quarter, according to Revenue Management Solutions, and as we said earlier this week, executives with the sector’s biggest chains are pessimistic about a quick recovery.

Other data released this week highlights that challenge. On Wednesday, the U.S. Bureau of Labor Statistics said that inflation is up 3.7% over the past year, including restaurant menu price growth of 3.5%.

That is the seventh straight month that inflation has outpaced wage growth. Hourly wages rose 3% over that period, meaning that real income is down by 0.7%.

Producer pricing data released on Thursday provided little real hope. The Producer Price Index rose 1.3% month-over-month in September, and 6.4% year over year. That’s the biggest jump since 2022.

That will likely keep pressure on inflation going forward, which will likely spur the U.S. Federal Reserve to raise interest rates.

Restaurants need a consumer with more spending power for much of their business. And for much of the population, that spending power is going down, and other economic data doesn’t suggest a near-term improvement.

The problem largely rests with lower-income consumers, who have been the primary point of focus of the fast-food sector’s three-year malaise.

Other data highlight the challenge this group has had. Credit card delinquency rates have soared, hitting 13% in the first quarter of this year, compared with 7.6% in the third quarter of 2022, according to the Federal Reserve Bank of New York. That increase points to a consumer under growing financial strain.

Lower-income households are also more likely to cut spending. A Fed survey released last week found that lower-income households were more likely to say they’re cutting spending and more likely to say their incomes are declining.

Unsurprisingly, they were more likely to say their financial situation has worsened, and roughly one-quarter of families say they have zero or negative savings.

Inflation put growing pressure on the U.S. consumer. The Iran War led to a spike in gas prices, which continues to persist into the fall, and which has worsened inflation enough that wages are now not keeping pace.

Broadly speaking, the consumer has weathered this storm enough to keep spending. But much of that spending lift has come from wealthier consumers, which means there is no trade-down to benefit the fast-food chains currently battling a years-long value war.

That consumer will be under pressure for the foreseeable future.

## Entities

- QSR (sector)
- Restaurant Business (publication)
- restaurant sales (topic)
- U.S. Bureau of Labor Statistics (regulator)
- Federal Reserve (regulator)
- consumer spending (topic)
- fast food industry (topic)
- U.S. Census (regulator)
- Revenue Management Solutions (company)
- inflation rate (topic)
- wage growth (topic)
- Federal Reserve Bank of New York (regulator)

---
Originally reported by Restaurant Business (https://restaurantbusinessonline.com/financing/consumer-buying-power-decreasing-right-now). Summarized by Burnaze (https://burnaze.com/article/a5ffbc6b-5cdc-4c16-8459-3bdb9d4c3cfb).