On March 31, 2024, my family closed down 153 Sushi, the restaurant that we had owned for eight years. The business had survived the early years of operation, a five-year period in which nearly half of restaurants failed. When the COVID pandemic hit in 2020, many restaurants were devastated as they were forced to shut down in-person dining; the main method by which many restaurants operate. Our family adapted quickly, switching to numerous delivery services. When we struggled to hire employees, our family members filled the roles. We changed our menu year by year to match changing trends. Seemingly, we did everything right, and yet we still failed. 

Including my family’s, more than 1400 restaurants across the country close permanently each week, or more than 200 restaurants each day. Many of these restaurants took what appeared to be the perfect steps and measures that should have resulted in success, not failure. Yet, even with the right actions, restaurants face broader challenges in the economy and changes in consumer behavior that are outside their control. These factors have threatened restaurants that play a fundamental role in our communities and the livelihoods of millions of families. 

The check is due

On paper, the restaurant industry may appear to be improving. The COVID pandemic has passed, and with it, the demand for dining out has rapidly risen again. In 2024, families reported an increase in dining out by 74% compared to the previous year.

However, these statistics are misleading because these gains have been rapidly outpaced by economic changes. Even with more customers, operating costs and food prices have soared over the past few years following the COVID pandemic. Since 2020, food and labor costs have risen 35% for restaurants. As a result, 42% of restaurants did not make any profit in 2025. 

Matt Ratz is the owner of UKraft, a local Ballwin restaurant who has partnered with West High numerous times in the past for events like Taste of West. UKraft was able to withstand the economic shocks of COVID and is now successful with multiple locations. Nevertheless, Ratz notes that many restaurants are still struggling from the aftermath of the COVID pandemic.

“I think [restaurants] hang on for so long, and those that have good credit [could] withstand [the conditions] for a couple of years. [They] go into debt and just work to pay it back. A lot of times, you don’t see the net effects of something until two or three years after something happens. I think a lot of companies [are] still battling back from COVID. They [are] trying to pay that debt [back], and inflation has caused some issues. I think no one wants to give up on anything. This has been a tough industry, it always has been, and that’s not going to change. Our profit percentages aren’t high in this industry. There’s not much wiggle room there, and it leaves our space very susceptible to unfortunate results,” Ratz said.

Even large restaurant chains and corporations have felt the financial pressure. Chapter 11 bankruptcies are a type of bankruptcy that allows businesses with large debts to reorganize their finances while continuing operations. Many famous restaurant chains that have operated successfully for decades have filed for these Chapter 11 bankruptcies, such as TGI Fridays, Red Lobster and Popeyes. Other companies like Wendy’s, Papa John’s, Pizza Hut, Jack in the Box and Noodles & Company have each closed hundreds of locations to cut costs. 

The rising costs have forced restaurants to either absorb the costs or increase their own prices at the risk of losing customers. In order for restaurants to maintain a 5% profit margin, the average restaurant would have to raise prices by 31%. But many customers don’t want to pay high prices for a meal they could have gotten much cheaper in the past. 

“I don’t think consumers are happy about [price increases],” business teacher Andy Croley said. “Ultimately, [costs] trickle down to the consumer at some point, and [when] consumers get used to it, it happens again. Rational consumers understand, but it also [forces] them to make some choices. Just like businesses right now are economically struggling, people are paying more at home for everything else, too, so it’s costing families more to enjoy going out. They’re not coming [to restaurants] as frequently.”

While customers notice price increases, they often fail to recognize the deeper economic factors burdening restaurants. Consumers fail to understand that despite the rebound in customer demand, the restaurant industry remains financially fragile. Rising costs, lingering pandemic debt and limited profit margins have created an environment where even successful restaurants are constantly balancing survival.

The changing appetite of America

Restaurants are no strangers to economic changes and have built a reputation for resilience and flexibility. In the last major economic disruption prior to the COVID pandemic, the 2008 Great Recession, the total number of restaurants only fell by 1%, even as other industries suffered. This time, however, restaurants have not been able to bounce back. Part of the reason is that the way people eat and how restaurants earn money has fundamentally changed. It’s not just the economic changes in food and labor costs that pressure restaurants, but modern consumer behavior itself that is threatening the entire reality of restaurants.

One of the major upheavals to the food industry has been the rise of online food ordering and delivery platforms. Increasingly, delivering food is becoming more popular than dining at a restaurant. According to DoorDash, 61% of customers dined in at a restaurant, while 77% of customers ordered delivery over the course of a month. The future of food trends is also projected to lean towards delivery, with 69% of Gen-Z using food delivery apps and 75% of customers expecting to rely more on delivery than dining in. Already, almost 75% of all restaurant traffic is off-premises through takeout, delivery and drive-thru. 

While ordering food without ever leaving the house can be convenient for consumers, for restaurants, the rise of delivery apps like DoorDash, Uber Eats and Postmates has been devastating, as delivery apps cut significantly into what would have been the business’s profits. For each order, delivery apps take a commission fee of 15-30%. On top of those fees, most platforms charge a 2-4% service fee for credit card processing and customer service. Then, if the restaurant would like more visibility on the app, they can pay for additional promotion by appearing faster on the search menu or being featured on the homepage. In the end, when the fees are taken out, the same $25 order is only worth about $17 to the restaurant. These earnings are further reduced when considering the costs it took to adopt the technology to support online platforms like tablets for tracking orders, card readers instead of cash or checks, reliable high-speed Wi-Fi and integrated systems that connect orders directly to kitchen printers.

Despite the losses, restaurants have no choice but to rely on delivery because of the growing consumer demand. As a result, restaurants are caught in a cycle where convenience for the consumer often comes at the expense of financial sustainability for the business.

“The third-party delivery streams right now are the future of America,” Ratz said. “I think [young people] really like that accessibility, [but] DoorDash is taking 25% of the sale from the restaurant. [Food delivery] wasn’t as popular [in the past] as it is now. Now it’s almost like you have to [have delivery to survive]. It’s just a cost of good business, but when they’re taking 25% of the sale, a business is never going be as profitable as it once was.”

At the same time, restaurants are under increasing pressure to adapt to constantly changing food trends and consumer preferences. Unlike in the past, where a restaurant could build a consistent identity over years, modern dining culture often rewards trendy dishes over identity. With the use of social media, new food trends can emerge, fade and move on to the next trend in weeks. 

UKraft has had to adapt to these trends like all restaurants. For example, Ratz has implemented matcha drinks into the UKraft menu. On the other hand, his team has discussed and are watching new trends like the Dubai chocolate trend. Restaurants that don’t adopt the latest trends are criticized for being outdated, yet restaurants that do adapt suffer as the constant menu changes are financially unsustainable and don’t produce long-term profits. 

“All the time, restaurants are not able to adapt and predict the next new trend and get on the front of that trend. It’s a simple approach [to] add a new product that is now trending to part of what is already on the existing menu without a huge expense. I think some places struggle with that change. Some people and businesses get set in what has always been the way they’ve done things and maybe [lack] the creative forethought to think about what they should do next,” Croley said.

It’s hard to find a healthy balance when restaurants are already operating under thin margins and must return profits quickly. It becomes even more challenging given that many restaurant owners lack formal education in business or marketing, and older owners in particular may not be familiar with social media, making it harder to identify trends or market their restaurants. For minority-owned businesses, these challenges are combined with language barriers and cultural differences, further limiting their ability to adapt.

Beyond the plate

The fact that restaurants are struggling should be troubling to all because it directly threatens the livelihoods of the 15.7 million Americans working in the food sector. For some, restaurants are the first or only support system, as one in three Americans find their first jobs at restaurants, and opening a restaurant does not require higher education. Many of these restaurant owners have their own families to support as well, with 79% of them having children. These families directly rely on the success of the restaurant in order to pay bills and afford groceries.

Restaurants provide opportunities to those who have historically faced discrimination and difficulty in employment. The food industry employs more women and minorities as managers than any other industry. In fact, 48% of restaurants are owned by minorities. Opening restaurants serves as a vital opportunity for immigrants who often lack the proper education, training or experience required to obtain jobs, or even if they do, are discriminated against. 

Restaurants opened by various ethnicities also help to promote cultural diversity and preserve identity. Ethnic communities are often centered around a cluster of restaurants like the Chinatowns throughout the nation, or locally, The Hill here in St. Louis, founded by Italian immigrants. These restaurants serve as more than businesses — they’re symbols of culture and history. 

Moreover, restaurants don’t just affect the individuals who own restaurants, but the greater community. Restaurants are part of a larger chain that supports multiple industries. When a customer spends their money at a restaurant, it also supports the restaurant’s suppliers, farmers and anyone else who is part of the food supply chain. The impact is greater for local restaurants that source their ingredients from producers within the community. 

However the greatest loss from closing restaurants isn’t economic — it’s social. As family dinners have steadily declined by 30% over the past three decades, so have the everyday moments that bring people together. Many families with teens now sit down together only once or twice a week. Research consistently links shared family meals to lower rates of anxiety, depression and risky behaviors, like substance abuse and teenage pregnancy, showing just how vital shared meals can be.

Across cultures and generations, sharing food has always been a symbol of connection. Restaurants extend that tradition beyond the home. They offer one of the few spaces where people can come together to relax, converse and connect without distraction. As more and more restaurants close and are threatened, society risks losing the fundamental comfort and connection a hearty meal provides.

“I think restaurants are great. [They] bring families together. [They’re] a gathering spot for friends and family,” Ratz said. “Some of your most cherished memories are at certain restaurants, and the laughs and the good times that you can have together. It’s one of the only times when you can let the stress go away. [People] are always on the run. Time is precious. It takes time at home to prep food, cook and clean and for [restaurants] to be that source of convenience for consumers is very important for a community.”