Restaurant prices in Iceland since 2019: menu prices compared with wages and food costs

When you put up the price of a dish, some guests notice, and a few will ask. It helps to know how your prices have moved compared with what you pay for staff and ingredients. Hagstofa Íslands publishes the numbers for this every month. This guide puts them side by side, from 2019 to the latest figures.

The figures are as of October 2026.

Four numbers from Hagstofa

Hagstofa measures prices in the consumer price index (vísitala neysluverðs, CPI) and wages in the wage index (launavísitala). This guide uses four series from them:

The food index measures what households pay in shops. It is not the price that you pay your wholesaler. It is still the closest public measure of what ingredients cost, and it moves with the same harvests, exchange rates and freight costs.

The chart sets each series to 100 in June 2019. June 2026 is the latest month with figures for all four series.

From June 2019 to June 2026, the four series rose like this:^{1 2 3}

Menu prices kept pace with food prices and with general inflation. Wages rose much faster than all three.

Wages rose fastest

The gap between wages and menu prices opened in 2021 and grew until 2023. In those three years, wages in hotels and restaurants rose 10 to 12 % a year on average. Prices in restaurants and cafés rose 3,1 % in 2021 and 6,9 % in 2022.^{1 3}

Wages in the industry also rose faster than wages in the private sector as a whole: 78,5 % against 63,3 % over the seven years.³

Read the wage index with care. It comes from Hagstofa’s wage survey, which is a sample survey.³ It measures wage rates. Your total labour cost also includes the employer’s pension contributions and the social security tax (tryggingagjald). The index also says nothing about how many hours you staff, so a restaurant that runs with fewer hours can have a smaller wage bill than the index suggests.

Food and menu prices moved together

Over the whole period, menu prices and food prices rose by almost the same amount. The years were different, though. In 2020, food in shops rose 5,0 % and restaurant prices 2,3 %. The gap between the two was largest in 2022 and has become smaller since.¹

Here is the change in the annual average for each year:^{1 2 3}

2023 was the year of the largest price increases. Restaurant prices rose 11,4 %, which was more than general inflation that year. Food in shops rose 11,9 % and wages 12,0 % in the same year.

The latest twelve months

From September 2025 to September 2026, the CPI rose 5,9 %, food in shops 4,3 % and restaurant prices 4,5 %.^{1 2} Part of the CPI increase came in September 2026. A temporary lower VAT on diesel and petrol ended on 1 September, and the VAT went from 11 % to 24 %. Hagstofa estimates that this change alone raised the CPI by about 0,32 %.⁵

From June 2025 to June 2026, wages in hotels and restaurants rose 4,6 %.³ Wage figures by industry come out about 80 to 85 days after the end of the month, so they are always a few months behind the prices.³

Which index means “restaurant prices”

Hagstofa publishes three indexes that sound alike. Use the right one when you compare.

• 11 Restaurants and accommodation includes hotels and guesthouses.
• 111 Food and beverage services includes restaurants and also canteens.
• 1111 Restaurants, cafés and similar is the one for restaurants. This guide uses it.

The difference matters. In September 2024, prices in canteens fell 35,9 % in one month. Hagstofa explained that this was largely because meals in compulsory schools became free.⁴ As a result, the wider index 111 rose only 1,2 % in 2025, while restaurants and cafés rose 5,0 %.¹ If you read that restaurant prices barely moved in 2025, check which index the writer used.

Hagstofa changed its classification to COICOP 2018. The table used here links the new categories to the old ones. Hagstofa links only categories that have the same, or very similar, content in both systems.¹

A simple example

Take a restaurant that in June 2019 took in 100 kr. without VAT. Of that, 40 kr. went to wages, 34 kr. to food and drink, 22 kr. to rent and other costs, and 4 kr. was profit. Those shares are close to the average for Icelandic restaurants. Our guide to food cost and menu pricing has the real figures.

Now let each cost follow its index to June 2026, and let the restaurant serve the same guests at prices that follow the restaurant index:

On paper, the 4 kr. profit has become a loss of almost 5 kr. Real restaurants did not stand still. They changed recipes, opened fewer hours, served more guests or changed how they staff the floor. The example still shows why so many owners felt squeezed after 2021, even though their prices rose as fast as inflation.

The example is a simplification. Your rent, electricity and supplier prices have their own history. Put your own numbers in the table for a real answer.

Talking to guests about a price increase

Most guests know that everything costs more than it did in 2019. A short, plain answer from the staff is usually enough: wages and ingredients have gone up, and the prices follow. You do not need to give percentages.

A few things make price changes easier for everyone:

• Change prices once or twice a year, not every month. Guests notice many small changes more than one clear change.
• Look at each dish, not only at the whole menu. The food cost guide shows how to work out the margin on each plate.
• Check the sales after a change. In Resto, the back office shows how many of each dish you sell, so you can see if a new price changed what guests order.

About the numbers

• All figures come from Hagstofa Íslands, as published on 2 October 2026. Hagstofa can revise them.
• The percentages for June 2019 to June 2026 and the index values in the chart are calculated by Resto from the published index values.
• Hagstofa’s wage index for hotels and restaurants starts at the end of 2018, so 2019 is the first full year that can be compared.³
• The CPI and the wage index are national. They do not show differences between regions or between types of restaurant.