A pedestrian walks in front of David's restaurant in Portland's Monument Square on Wednesday Feb. 24, 2021. Credit: Troy R. Bennett / BDN

If you’ve paid more for a restaurant meal lately, you aren’t alone. Increases in the costs of labor, food and nearly everything else restaurants need to do business are driving owners to raise prices. 

Maine restaurant owners say they’re facing double-digit percentage increases in the costs of ingredients and other goods needed to run their businesses. Those surging expenses, paired with an industry-wide trend toward higher wages, mean restaurant owners must raise menu prices if they want to maintain already tight profit margins. 

“When the price of your ingredients [and] your labor goes up, your business model will fail unless you follow that with your margin at an acceptable level,” Cafe Miranda chef and owner Kerry Altiero said. “I think any business that practices the ostrich technique is going to be in trouble.”

Restaurants around the country are facing the same problem, as food and goods prices have risen substantially due to pandemic-related supply chain bottlenecks and pent up demand. 

As of September, the prices consumers pay at eating and drinking establishments have gone up 4.7 percent nationally compared with last year, according to U.S. Bureau of Labor Statistics data. At no time in the last decade has that rate of increase been higher.

Lynn Archer, owner of Archer’s on the Pier in Rockland, said a year ago she was paying $7 a pound for prime ribs. Now it’s $17 a pound. One of the biggest spikes she’s seen is the cost of frying oil. Last year she was paying around $28 for a five-gallon container of canola oil, now the same quantity costs $89. 

Camden Deli owner Tom Rothwell said since the beginning of the pandemic, his downtown eatery has seen a 30 to 50 percent increase in everything from meats and seafood to condiments and paper goods. 

“No item is immune from the rising costs,” Rothwell said. 

It’s hard to know whether the price increases that are affecting all industries ― not just restaurants ― will level out or if they will result in lasting inflation. 

“It’s complex,” Tim Consedine, a New England-based regional economist with the Bureau of Labor Statistics, said. “We can’t look into a crystal ball and provide that answer.”

Restaurant owners say the price increases began with the onset of the pandemic. Rising prices for some ingredients have been more gradual. But others, including meat products, have spiked due to shortages.

“I think it’s been a gradual march upward, but then there were jumps with beef and pork and stuff like that,” Altiero said. “Everytime a price goes up, even when the situation goes away, it never goes down to its previous level.” 

Restaurant owners also have difficulty finding necessary ingredients. Rothwell said he has had to both use multiple distributors “and [find] alternative solutions that have never been needed in the history of our business.”

David Turin, of David’s Restaurants in Portland and South Portland, said the pandemic has also added new costs. Last month, Turin spent $600 on masks for staff and customers. Ventilation systems installed to help with airflow are also causing higher electric bills, he said.

Turin said, generally, whether it’s ingredients or goods — from staff uniforms to paper products — or even utilities, prices have steadily risen. 

“Things have gotten really expensive,” Turin said. 

At the same time, wages have also gone up. Nationally, employment costs in the hospitality industry increased 8 percent from the third quarter of 2021 over the third quarter of 2020, according to Bureau of Labor Statistics data.

For non-tipped staff, Archer said she’s always paid more than minimum wage, but prior to the pandemic, her starting wage was about $13 to $14 an hour. Now it’s between $16 to $18 an hour. Turin said in 2019, the starting wage at one of his restaurants was about $12.25 an hour, now it’s $18.22. Within the last year, Alterio also said he increased wages by about 30 to 40 percent. 

“That’s the only way you’re going to have an employee in the hospitality industry right now is if you pay more,” Turin said. 

There are only so many ways restaurant owners can recoup these rising costs. Turin said he’s changed his hours to be more efficient, as well as what he is offering on his menu. But he’s also had to raise menu prices. After cutting prices at the start of the pandemic due to a switch to take out, Turin has since increased his menu prices to about 10 percent higher than what they were in 2019.

“There isn’t one person [in the restaurant industry] I’ve spoken to in the last 18 months that isn’t struggling on some level about all of these issues,” Turin said. “Everybody is raising prices, I don’t think anybody is not raising prices.” 

Altiero estimated his prices have gone up about 15 percent in the last year due to labor and food costs. 

While Archer has only raised prices on a couple of items in the last year — like her lobster club sandwich and prime rib special — nine dishes on her winter menu will cost more.

However, these increases don’t make up entirely for the higher costs she’s been paying for food and labor. Ultimately, Archer is just eating some of the expense.

She said she can’t complain though. Archer’s had its busiest season on record this past summer. 

Archer said she would likely consider dropping items from her menu before raising prices across the board. “There are certain things that I’m not going to change ever and sometimes you have to think that way,” Archer said. 

But for the most part, restaurant goers aren’t pushing back on price increases, restaurant owners say. 

“We haven’t had a lot of sticker shock on our menu [prices],” Turin said. “I think that people are aware that it’s just gotten to be a more expensive climate.”