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Demographic Impacts

Perhaps the single most important factor impacting the food service industry is the changing composition of the American household and lifestyle. Unlike the traditional nuclear family with a working father, homemaker mother and several children, it is now common to find single-adult, two-working-adult or single-parent households. Today's household is also more affluent than past generations with both adults and teenagers possessing greater spending power. Additionally, busier lifestyles leave less time for the job of meal preparation and the highly structured dinner occasions of past years.

This is good news for the food service industry, which is enjoying an unprecedented increase in the number of people eating out and significant growth in sales-from $42.8 billion in 1970 to an estimated $475.8 billion in 2005. Eating take-out at home or on-the-run is becoming the norm. Food service operators will be challenged to deliver convenience-meals that are easy to order, easy to eat on the go, and easy to clean up. A newer entry to the food service industry is the operation that specializes in take-out food. Known as home-meal replacement (HMR), these food service facilities have cropped up as personal chefs or in grocery stores.

Although overall population numbers and food consumption are expected to increase, changing demographics will change the face of the food service industry in several ways. The aging baby boomers will contribute to an older population and greater number of retirees. Older people are generally more concerned with health issues, eat out less often and generally eat less. Additionally, the Mexican and Asian populations are expected to grow at a faster pace than other segments. Restaurants will respond to these changes with different menu offerings that may require new technologies and types of equipment. Also larger retiree and immigrant populations open up a worker base previously not available to restaurant operators.

A concern for food service providers is the rising rate of obesity among Americans. One source suggests that if the trend continues, approximately three-fourths of American adults could weigh too much by the end of the decade. Some critics want to blame school lunch programs for the development of unhealthy eating patterns and the food service industry in general for contributing to the rise of chronic diseases associated with obesity. It is possible that some companies could face litigation and the industry could be subjected to government regulation.