Recession indicator? People are cooking at home at the highest level since COVID
For a rising share of Americans, something they made themselves. That's according to the most recent earnings call for Campbell's, where the CEO of the food giant said they've seen more people opting for a home-cooked meal than they have since the start of the COVID-19 pandemic.
'Consumers are cooking at home at the highest levels since early 2020,' Mick Beekhuizen said Monday. Sales were up in the meals and beverages category for the company, which owns the canned soup brand as well as Rao's, Prego, Swanson, Pepperidge Farm, V8 and other grocery store staples. Specifically, spending in the U.S. was up for pasta sauce, broths, and condensed and canned soups.
Dave Chalk, Campbell's vice president of consumer insights for meals and beverages, said the company uses interviews with consumers and behavioral data collected by research companies to assess at what rate people are cooking at home.
'We have seen a shift to what we call 'stretchable' categories,' he said in an email. 'These are categories like soups used for cooking and also include rice, pasta, broths and Italian (pasta) sauce.' He said the company has also noticed consumers opting for premium products, like Rao's pasta sauces, that can help make a homemade meal taste more like it came from a restaurant.
Unfortunately, this behavior probably isn't a sign of a cultural shift toward healthy eating and thoughtful budgeting, said WalletHub managing editor John Kiernan.
'It's definitely not a sign of the economy doing great,' he said. 'People aren't going to be loading up on the staples and eating home far more often if they're feeling flush.'
Back in the early part of 2020, consumers were adjusting to lockdowns and limited grocery store hours alongside predictions of potential global economic collapse in the face of a novel virus. The economic policies that staved off that potential collapse — low interest rates, stimulus checks — instead pushed the U.S. and most other developed economies into a protracted period of inflation.
Exit polling in 2024 indicated many voters were persuaded by so-called 'kitchen table' arguments – the idea that President Donald Trump would bring down the price of eggs and other household goods. Instead, he's introduced several large-scale policies that aggravate inflation, including immigration crackdowns (which make grocery prices go up) and widespread tariffs (which make all prices go up).
A soup-buying boom could be yet another one of the 'recession indicators' we've heard so much about. Actually, according to a report released Monday by financial services company Morningstar, some of the classic economic indicators of a recession have cooled off — but it's hard to say whether the recent GDP contraction was a tariff-induced blip or a sign of things to come. A recession is technically defined as two consecutive quarters of GDP shrinkage.
From the perspective of a personal finance columnist, I don't think it's a bad thing for people to experiment with cooking at home, though I wouldn't recommend financing your groceries if you don't absolutely have to. Cooking at home is certainly cost-effective, as we found in a Chronicle analysis comparing identical meals procured via food delivery app, meal kits and good old-fashioned groceries. As someone who went through this journey myself, I can say that cutting back on dining out and learning to cook simple meals at home is both personally and financially rewarding.
Much of the U.S. economy is driven by consumer spending, and a lot of local economies rely on people going out to eat. But that's not your personal problem to solve. My 31-day Wealth Challenge newsletter dives into how to effectively meal plan, plus lots of other tips to cut spending and up your savings. You can sign up below:
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