The Recession Hitting Fast Food

During the Great Depression, many struggled to afford basic needs, and today, we're seeing similar signs. Once known for its affordability, McDonald's prices have soared; raising concerns about economic stability, which as you may now be aware of, is no news. For fast-food companies that often promote an image of affordability, low-income consumers are a significant portion of the customer base and a bellwether for longer-term trends. However, they are typically the first to cut back spending and the last to come back.
According to recent statistics, 28% of people earning under $50,000 have reduced their visits to fast foods. A major reason is inflation. Inflation is driving up the cost of everything from beef to potatoes to the packaging for our favorite fast food items. For instance, McDonald's has seen its operating expenses increase by 14% in the last quarter, reflecting higher costs for raw ingredients and labor.
When inflation rises, everything becomes more expensive, including fast food. In 2021, the U.S. inflation rate hit a 40-year high of 7%, affecting the entire economy.