Why Every Meal Out Is a Splurge Now

I'm sorry, but $64 for roast chicken?

In September, I spent some time with Jason Buechel, the chief executive of Whole Foods, while he was in town for New York City’s Climate Week. We got to talking about inflation — the number one topic taking up brain space these days for anyone in the grocery business — and he told me about some mysterious sales data his team had recently come across.

Expensive cuts of meat, like rib-eyes and beef tenderloins, were flying out of butcher cases, showing some of the fastest sales growth of anything in Whole Foods’ assortment. 

This didn’t make any sense. Whole Foods knew that its customers were responding to higher grocery prices with budget-friendly swaps, like choosing the store’s private label products over name brands. Fancy meat should not be selling.

Ultimately, Buechel’s best guess is that those meat buyers are, in fact, trading down: from date night at a restaurant to a fancier-than-normal meal at home.

Of this theory, I did not need further convincing. There’s no such thing as a cheap dinner out anymore. I’ve noticed it, and I bet you’ve noticed it too. Personally, my brain has not caught up yet with regularly seeing entrees north of $40 (even at casual places!), or the fact that $18 seems to be the new normal for a green salad. 

I moved to New York in 2005, at the start of the city’s David Chang era, when many of the hit restaurants were affordable for — well, could be afforded by — an editorial assistant making $24,000 a year. At Chang’s Momofuku Noodle Bar, the ramen cost $13, and you could tack on an order of pork buns for another $7. Mario Batali had recently opened Casa Mono, a buzzy tapas joint where dishes topped out at $15. In 2009, Rich Torrisi and Mario Carbone gave us Torrisi Italian Specialties; the cooking was instantly legendary, and the prix fixe was $50. 

Today, though, New York is a city of $500 omakase menus and cute trattorias where a pork chop borders on the cost of a used car. It seems like everyone has quietly accepted the creep of $40 caviar supplements and three-digit cuts of meat (don’t worry though, it’s a porterhouse for two!) from the top echelons of fancy fine dining into everyday bistros and cafes.  

The impossible reservations are now at places like The Polo Bar (Dover sole: $80) and Tatiana ($56 for the famous braised oxtails). Rich Torrisi has a different namesake spot, Torrisi Bar & Restaurant, and here most of the entrees alone will set you back more than $50. Legacy midtown white tablecloth restaurants have always been a splurge, but back in 2006, a seven course tasting menu at Jean-Georges was $125. The restaurant now offers six courses for $298.

I could go on, but you get the picture. I suspect some of the most extreme excesses are particular to New York, and maybe a handful of other cities – Miami? Los Angeles? San Francisco? – which have, in the past decade, seen a portion of their residents launch out of our general economic atmosphere into a new, celestial stratosphere of wealth.

In 2008, for instance, Forbes listed 65 billionaires living in New York City with a total fortune of $244 billion – a figure that seems almost quaint when you consider that it’s not that much more than Michael Bloomberg’s individual net worth today. The city is also now home to 350,000 millionaires – up 48% since a decade ago.  

In New York, and cities like it, there is now a very large audience for good food at almost any price. (Jane has long been trying to write a story about the chefs who have decided it’s better for their bottom line to go after the 1 percent; regular folks be damned. But –shocker! – no one will go on the record.) This know-no-bounds crowd at least partly explains why one can walk into a restaurant sending casual bistro vibes and discover that the chicken dish is $64. 

But, there’s also data to show that this is not just another weird and unfortunate facet of living in cities dominated by the ultra-rich. Restaurants everywhere are much more expensive than they were a decade ago – and also much more expensive relative to the cost of groceries, or consumer prices overall. 

This chart does a nice job of showing how restaurants – the red line – have pulled away from not just the cost of groceries (in blue), but consumer prices in general. 

So…why is this happening? The short answer is the cost of labor. Restaurants’ expenses have gone up across the board, just as yours and mine have, for everything from ingredients to rent to utilities to insurance. But it’s wages that have really transformed the cost picture. Food service workers’ wages have increased 32% over just four years, according to Bureau of Labor Statistics data. That would cause any industry to make some dramatic shifts in pricing. But restaurants — especially sit-down restaurants — are among the most labor-intensive businesses in the economy, making the impact especially dramatic. 

As a diner, this big jump in wages might feel over the top and a little annoying, but it’s actually making up for a long period of time when restaurant workers were underpaid. Food service workers lacked bargaining power until the pandemic disrupted the industry, and employers needed to coax them back. 

Culture played a role here, too. Remember the year 2000, when Anthony Bourdain’s Kitchen Confidential hit bookstores, and your mom was suddenly on a first-name basis with Emeril Lagasse? Being a chef held a new prestige in the early aughts, creating a large pool of kitchen labor willing to put up with bad pay and long hours for a chance at rising through the ranks to get their own restaurants — maybe even their own TV shows. Chef-owners would eke out the slimmest of profit margins in exchange for the cultural currency and creative freedom that came along with calling the shots. That meant that, for a while there, restaurants were artificially (and, ultimately, unsustainably) cheap. 

Today, we’re catching up with the reality of what it costs to run these places, pay everybody a living wage, and maybe even make a decent profit. That magical moment when I could eat at exciting restaurants multiple times per week as a cash-strapped 20-something: that moment is good and over. 

So where does this leave a restaurant lover without Mike Bloomberg’s dining budget? 

I’ll admit that the options for outsmarting the rising cost of a meal out are fairly limited. The restaurants we love are usually one of a kind; it’s not like when the exquisite Korean spot downtown raises prices, you can find a practically identical knock-off on Amazon. For the most part, these places are run by talented people working very hard to give you a special experience. If you value what they’re doing, you’ve simply got to stump up for it.

What I can suggest: since it’s the cost of labor that’s driving prices up the most, one strategy for finding value is to look for places that run on less labor by design. Here in New York, great bars with small but killer food menus — and there are plenty of them — have become my new default for casual weeknight dinner plans. Since bars don’t typically employee waitstaff, and the margins are high on alcohol, they can price food quite competitively and still be sustainable businesses. 

There’s also a growing category of “fast-fine” restaurants – places like Parakeet Cafe in Southern California, Souvla in San Francisco, or KazuNori in Manhattan – which are fancier than a Cava or Five Guys, but cheaper than a full-service restaurant. The proposition here is food and atmosphere that’s every bit as good as a traditional restaurant, only you order at a counter rather than being waited on. A model like this one intentionally cuts out a sizable chunk of labor, allowing for lower prices. 

I’d really like to know whether you, reader, are seeing restaurant prices climb where you live, and if yes, whether it’s changed where (and how often) you eat out. Have you found smart ways to stretch your dining budget further? Drop your thoughts in the comments.