Employment data negative for quick service, positive for casual dining.
The overall jobs picture this morning was unequivocally negative with Nonfarm Payrolls coming in flat, way below expectations at 0k versus expectations of +68k. The level of growth in employment among the 20-24 years of age cohort decelerated in August, which is a negative data point for QSR. July employment growth among this age cohort came in at 1.4%. The 55-64 years of age cohort saw strong employment growth in August, accelerating to 2.7% year-over-year versus 1.1% in the month prior.
Sentiment has clearly become more negative across the board recently, with consumer confidence plummeting in August and sliding home prices moving into the spotlight. This data point is, on the margin, negative for QSR and positive for casual dining.
The second chart below shows employment growth in the food service industry. Hiring continues to be strong on a year-over-year basis but, on the margin, employment growth in both full service and limited service slowed sequentially. We will continue to monitor this trend closely in the coming months.