Popular casual-dining restaurants such as Olive Garden, Ruby Tuesday and Cheesecake Factory will have their work cut out for them in 2013 as consumers grapple with smaller paychecks and less disposable income.
A payroll-tax break granted during the recent recession that for two years had added about 2% to every U.S. paycheck expired on Jan. 1, denting workers’ take home pay.
The smaller paychecks and reduced disposable income mean consumers will have to decide where and how to spend with less.
In addition to the higher payroll taxes that will impact consumers, restaurants will also have to deal with higher health-care costs stemming from new mandates under President Obama’s 2010 health-care reform law that now requires employers to offer their workers health insurance.