The fast food chain raised prices to accommodate rising food and labor costs.
Chipotle, at least as far as their menu pricing goes, is what I like to call a “B-Tier” chain. As opposed to a C-Tier chain like McDonald’s, where you can get like two meals worth of food for under ten bucks, ten bucks will only get you one complete meal at Chipotle (though it’s probably of a higher quality). That tier may have to be adjusted a bit, though, because the Mexican dining chain has raised their menu prices across the board.
Back in May, Chipotle announced that all of their hourly employees would make a minimum of $15 an hour by the end of June. Multiple food and retail chains have been raising employee wages to entice new workers; a lot of these chains have lost substantial amounts of their work forces during the pandemic, as the dangers of front-line working have prompted many to reevaluate their employment priorities and seek higher pay. In order to accommodate these increased wages, though, as well as rising costs of ingredients due to global food shortages and infrastructure hold-ups, Chipotle raised their menu prices to even things out.
Chipotle Mexican Grill has hiked menu prices by roughly 4% to cover the cost of raising its workers’ wages. https://t.co/ba3L5Wkm8e
— NBC News (@NBCNews) June 9, 2021
“It feels like the right thing, at the right time, and it feels like the industry is now going to have to either do something similar or play some kind of catch-up,” Chipotle CFO Jack Hartung said at a virtual conference. “Otherwise you’ll just lose the staffing gain.”
Hartung added that Chipotle obviously didn’t want to raise their menu prices, but that it was the best option they had to keep their books balanced while still providing increased employee wages.
Employment in leisure and hospitality fields are down by 2.5 million compared to this time last year, according to statistics from the Department of Labor. If fast food chains want their workforce back, they may have to pump the gas a little harder.