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On a recent morning, the McDonald’s in the shadow of Boston’s Fenway Park was shy on regular customers. A construction worker named Curt emerged with an Egg McMuffin: “I’d rather go to a diner than eat this garbage,” he said. “But in the allotted amount of time I have, this is what works.”
At an earnings call on Wednesday, McDonald’s CEO Chris Kempczinski said that the chain has seen visits from lower-income customers fall by double-digits during the second quarter, with the chain’s 50-year-old breakfast menu particularly hard hit. He said the meal “is the easiest daypart for a stressed consumer to either skip breakfast or choose to eat breakfast at home … we as well as the rest of the industry are seeing that the breakfast daypart is absolutely the weakest daypart in the day.”
Daypart, which is fast-food speak for “meal,” is how the big chains divide up their revenue between menus. And what makes Mickey D’s breakfast interesting, suggested CNBC’s Carl Quintanilla, is that it could be considered a “proxy for employment. You’re more likely to visit if you have somewhere to go in the morning.”
In other words, the Egg McMuffin might be the answer to the question that has bedeviled economists since Donald Trump launched a global trade war on “Liberation Day”: When will the U.S. economy respond to these big new taxes?
Everybody loves an obscure recession indicator. Joe Kennedy famously said it was time to get out of the market when the shoeshine boy started giving stock tips; Michael Burry was worried about strippers and strawberry pickers with investment properties. You could look at how many Americans are living with roommates, or applying to law school. If we can’t trust the Bureau of Labor Statistics to report the numbers anymore, why not turn to the a.m. drive-thru line at McDonald’s?
As Kempczinski observed, the trend is not limited to the Golden Arches. Data from Revenue Management Solutions, an industry analyst, shows that breakfast revenue is down 8–10 percent over this time last year for a broader section of “quick-serve” restaurants. And that comes on top of lackluster data going back to 2022.
As for the correlation with the broader job market, well … that’s not so clear. The idea seems to have its roots in the global financial crisis, when millions of people lost their jobs and fast-food breakfast sales declined. “Typically, if you’re unemployed, you’re not getting up at six and not going through the drive-thru,” Jeffrey Bernstein at Barclays Capital told the Washington Post in 2010. “There is a direct correlation between unemployment and breakfast sales.”
Now it’s become the conventional wisdom: “If breakfast away from home slows, that is a key indicator because it’s cheaper to eat cereal at home,” the food trend researcher Suzy Badaracco told an industry conference this spring.
All that said, it’s not clear why breakfast would be the canary in the coal mine here. Fast-food breakfast has boomed over the past few decades as part of the broader trend of Americans spending more money out of the house—restaurant spending surpassed grocery spending for the first time in the 2010s, and it hasn’t looked back. Inflation could be chipping away at that habit, regardless of the job market.
If it’s downtown offices you’re concerned about, perhaps look to lunch: The Wall Street Journal reports that office drones are bringing their own food to the office and that restaurants sold fewer lunches in 2024 than even in 2020, at the height of the pandemic. Traffic at sad-desk lunch staple Sweetgreen is down 10 percent year over year.
So the question for breakfast theory is: Are people skipping their egg sandwiches because they are working less? Or are they just grabbing a bite at home because an Egg McMuffin is, in Boston anyway, $6.59? You might not need to lose your job to develop a taste for granola bars.
