How New York’s restaurants suddenly got so expensive — and why that’s probably for the best. mahirarivers reports
It’s not your imagination: Restaurant prices are rising at unprecedented levels. Animation: Allie Sullberg When the restaurant Oxalis opened in Brooklyn’s Prospect Heights neighborhood in 2018, it looked like a lot of other upscale dining rooms in the city. Chef Nico Russell’s food was neatly plated, framed by plenty of negative white space, and favored in-season ingredients. At the time, the multicourse tasting menu cost $60.
Food costs are skyrocketing. Ingredients should account for about one-third of a restaurant’s budget, according to conventional restaurant accounting. But in the current environment, wholesale food costs — what operators pay for bulk ingredient purchases — are going up, making that target increasingly difficult to hit.
To account for this, some operators are tinkering with individual menu items while others are simply raising overall prices a few percentage points. Kim raised the cost of all his noodle dishes by about a dollar. He also includes a 5 percent surcharge to his menu, permitted by a restaurant relief program that was instated by New York City last year. An alternative solution is to overhaul menus by replacing expensive and volatile ingredients with something else entirely.
Sam Yoo, who operates Golden Diner in Chinatown , puts it another way: “We’re just sort of subjected to whatever price is given to us by our supplier. It’s like being stuck in limbo.” But even though momentum for higher wages had been mounting, the issue exploded during the pandemic, and is now reshaping the entire industry. The moment has led some businesses to preemptively offer better pay. At Coast and Valley, in response to a year of extremely difficult working conditions, Watanabe and her business partner, Eric Hsu, decided to eliminate tipping, opting instead to pay their staff a universal living wage of $25 an hour.
COVID created entirely new categories of expenses. Beyond food and labor, there are a handful of miscellaneous costs that are new to the era of the pandemic, are not insignificant, and are likely not going to disappear anytime soon. PPE is now a built-in cost for operators, and many say those prices are going up, too — the price for a box of gloves has doubled in recent months.
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