Is it just us, or are groceries getting more expensive?
It’s not us. In 2011, grocery prices rose as much as 12%, depending on the item.
Interestingly, restaurant prices didn’t rise nearly as quickly, increasing by only 2.5% over the past year.
But if it’s all food, why was there such as difference in price increase?
What’s Really Going On
While food prices rose more than usual (up to 4.75% as opposed to an annual average of 2.9%), the cost of staples showed a special spike. Meat, eggs, apples and milk (and ice cream) all went up about 10%, and potatoes jumped 12%. The prices for fruits and vegetables rose by only half of that, giving our vegetarian and vegan friends the advantage when it comes to paying for groceries.
Daily Finance points out that responsible practice of eating at home, adopted by so many families coping with recessionary cutbacks, ironically increased the prices for groceries over restaurant meals. As more people bought groceries to eat at home, suppliers were able to charge more. Additionally, increased global demand, plus rising commodity and energy costs pushed prices up.
The reason why this price increase isn’t showing up on your restaurant tab is restaurants’ unwillingness to pass on increased food costs to their customers. (The last thing restaurants need to do right now is give their patrons yet another reason to stay home.)
In 2010, Americans spent nearly half (47.9%, to be exact) of their food budgets on eating out. In 2012, it’s expected that restaurant prices will rise slowly, but they will rise. Of course, meal prices for freegans will continue to be suspiciously low.
Sure, this news could be used to argue that a night out is the financially responsible move, but let’s be real: $50 in groceries to get you through the week will always be a better deal than $50 on one restaurant meal.
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