A Wider Look at the Restaurant Industry: Economy, Tourism and Demographics
To establish the importance of the Nashville restaurant scene in a greater context, it is important to understand how it is a driver for state economic growth.
According to the National Restaurant Association, the restaurant industry is a major driver in the state for economic growth. As of 2018, there were 313,100 restaurant and food service jobs in Tennessee and the industry saw over $12.2 billion in revenue. Furthermore, the number of food service jobs was expected to grow by 11.8% in 2018. Clearly, restaurants are an important economic driver for the city of Nashville and the state.
Interestingly, the restaurant industry has been found to be an important indicator of overall economic health in the U.S. Researchers found that money spent dining out at restaurants is one of the first expenditures that people reduce in uncertain or challenging economic times. Therefore, if restaurants are doing well in Tennessee, it’s likely that the economy is also growing. It is clearly important to understand the Nashville restaurant industry, for reasons beyond just staying up to date on latest food trends.
The projected economic growth that the restaurant industry provides is directly influenced by tourism in Nashville and the state. Nashville set a record for annual visitors in 2017- 14.5 million people visited the city, which lead to a near high in terms of hotel rooms sold. This was a 4.6% increase from 2016. Tourists bring significant revenue to Nashville restaurants.
In order to predict and understand the success of the Nashville restaurant industry, it is important to look at larger demographic trends in the city and state. Growth seems extremely likely in Nashville; research shows that the city is expected to grow by 50-75% by 2040. The city is becoming younger and more diverse, which is evidenced by the fact that Davidson county will soon have a majority-minority population. Household sizes are expected to continue to increase as the city becomes larger and more diverse.
Understanding how the restaurant industry is related to the economy, demographics and tourism is critical to project future potential and challenges. With important changes in the demographic makeup of the city, Nashville is expecting to see many more immigrants in the next few years seeking jobs in the restaurant industry. In my next post, I will explore some of these implications, from both a policy perspective and a cultural perspective.