Minnesota’s $9 billion hospitality industry is feeling the squeeze as middle-class consumers cut bac

Minnesota’s $9 billion hospitality industry is feeling the squeeze as middle-class consumers cut back on leisure spending. Prices rise faster than wages, squeezing households and hurting hotels, restaurants. Craft and Crew Hospitality owner David Benowitz says big price hikes won’t fly with customers, so menus may see only modest increases. National data show discretionary spending on leisure has slowed, with February spending barely rising and recreation services down, threatening a broader downturn as inflation persists. The industry faces a bifurcated economyand wealthy consumers continue to spend, while middle- and lower-income households trim discretionary purchases, straining an industry already burdened by tariffs, regulations and higher input costs. A Hospitality Minnesota survey found many reporting declines in profits and traffic in 2025, with closures or shifts. In tourism, Acorn Hill Resort reports occupancy closer to normal but rising taxes and tariffs, and Twin Cities venues face slow early activity and uncertain summer.
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