A 'perfect storm' is wiping out America's restaurants - here's why the Midwest is hardest hit by closures

Americans are eating out less as inflation weakens the dollars in their pocket, which is leading to some harsh consequences for restaurants across the country.

Visits to sit-down restaurants were down nearly five percent in 2023 from the year prior, according to location analytics firm Placer.ai. 

Even big metropolitan areas in the US known for their great dining spots are struggling to maintain an environment where it's profitable to run a restaurant. 

Eater NY reported that over 40 bars and restaurants closed in New York City from December 2023 to January 2024, with some of the owners saying business simply never picked up after the COVID lockdowns in 2020.

But in a city where it would take a person over 22 years to eat at every single restaurant, the problem isn't as pronounced. 

Jessica Dunker, pictured, said many restaurants that are forced to fold couldn't pay their 30-month deferred loans, some of which were taken out during COVID lockdowns

A restaurant in McKinnon, Georgia that was abandoned because of the lack of customers 

In middle America, where there are fewer people and household incomes are lower, almost all restaurants are feeling the pressure of empty seats.

Iowa's capital city of Des Moines, for example, has seen many restaurants close because of lower foot traffic. Establishments are of course aware of this but so are the remaining restaurant regulars.

Abby Sheffer, a law student at Drake University, told local station KCCI that she and her friends have noticed 'there's a lot less people.'

'We went to the barbecue place down the road, and we were the only ones in there. And it was like that for two and a half hours,' Sheffer added. 

Des Moines native Monica Wilke-Brown said she thinks 'people got used to cooking at home too and just going out less.'

The latest casualty of the rash of restaurant closures in Des Moines was Gusto Pizza, which for almost a decade was a persistently popular place to get a slice. 

Monica Wilke-Brown, left, says people have gotten used to cooking at home more and eating out less post-pandemic. Abby Sheffer, right, commented that she too has noticed the shorter lines at restaurants

Gusto Pizza, a Des Moines staple for nearly ten years, recently closed down amid a rash of restaurants boarding up in the midwestern city

The president and CEO of the Iowa Restaurant Association, Jessica Dunker, says that restaurants across the country are being hit with the double whammy of increasing food costs and rising labor expenses

The dark, gloomy interior of Gusto Pizza after its recent closure

Gusto Pizza pictured on a somewhat lively night before its ultimate demise

Jessica Dunker, the president and CEO of the Iowa Restaurant Association, said the reason restaurants are shuttering is because the cost of goods is up 30 percent and they are having to shell out higher wages to keep staff on.

Dunker also pointed out that many food businesses are struggling to pay back loans they took out during the pandemic. The deals, most of them 30-month deferred loans, were likely necessary when lockdowns were in full swing and restaurants had virtually no customers by force of law. 

But with foot traffic down across the board, according to Dunker, if restaurants can't pay off their loans, they are forced to close.

'There is an increase not just in the state of Iowa but across the country in these small independent restaurants just not being able to see what five or 10 years can look like in a way that makes business sense,' Dunker said.