Page last updated at 10:23 GMT, Wednesday, 15 July 2009 11:23 UK

Chips are down in the recession

Fast food
The fast-food sector has mushroomed in recent years

The total amount spent on eating out for less than £15 a head in the UK is set to dip for the first time in 40 years, according to a report.

The £40bn market for "informal eating out" had previously been regarded as recession-resilient as diners traded down for affordable fast food.

But the study suggested that the sector was expected to shrink by 0.5% in 2009.

The research, by industry analysts Allegra Strategies, looked at fast-food restaurants, pubs and sandwich bars.

It suggested that UK diners were eating one in nine meals away from home, down from one in eight last year.

People in Scotland spent an average of £13.91 when they ate out, compared with a UK average of £12.75, it found.

Rebound

There are about 250,000 independent food and drink establishments in the UK, but the report - called Eating Out in the UK - found that 15,000 jobs were lost in the sector last year and 20% of people were expecting to eat out less in the coming year.

Fish and chips
Informal eating out has dipped in the recession

"There is a myth that the informal eating out sector is recession proof, but this report shows that, while some companies continue to do well, many are suffering," said Steve Gotham, project director at Allegra Strategies.

"The industry will have to become more consumer-focused as customers will not forget what they are learning in the recession.

"Eating out may have become an everyday experience, but when the economy picks up, people will not go back to paying over the odds for a meal."

However, there is confidence that the market will rebound in the next 12 to 18 months.

The market should grow again to £47.5bn by 2014 thanks to rising trends in affluence, mobility, more youthful older customers and an Olympics boost in 2012, the report said.

The poll of more than 2,000 people was sponsored by McDonald's and its UK chief executive Steve Easterbrook said that there had been a squeeze on discretionary spending so no sector was immune to the recession.

He told the BBC that the fast food sector had grown in the last 10 to 20 years to play a key part in the UK economy as a whole.

But he said there was a mixed outlook for the sector in the UK, notably the "storm cloud" of a return to a VAT rate of 17.5% in the new year.



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