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This Popular Fast-Casual Mexican Chain Is Quietly Raising Prices Across the Menu

Offsetting higher average wages for the chain's workers.

Chipotle is raising the average wages for its employees to $15 an hour, but the customers will be the ones paying the difference.

According to recent reports, the chain is raising its prices by 4% across the whole menu in order to make up for the higher employee salaries. This translates to about 30 to 40 cents more for an average Chipotle meal.

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The move was confirmed by Chipotle executives at the Baird Global Consumer, Technology & Services Conference on June 8. CFO Jack Hartung acknowledged the industry is dealing with labor shortages and increases in ingredient prices, but the menu price increase will only reflect the latter.

"And the intent there was to basically cover the dollar cost of the increase in wages. Okay, not to protect margin, but to cover the dollar cost," he said at the virtual presentation. "And, you know, we'll see how the rest of the year unfolds."

The chain doesn't immediately plan on increasing prices further due to growing ingredient costs. "Ingredient costs, there's talk about it. We'll see where that leads," Hartung said.

Yielding to public pressure and operational issues caused by staff shortages, the chain announced in May that it would increase its average hourly salary to $15 by the end of June to entice and retain employees. However, this doesn't mean that all of Chipotle's employees will be making this hourly wage, but that their starting hourly compensations would range between $11 and $18—about a $2 increase—depending on location.

If you're a frequent customer, you've likely noticed your Chipotle order totals increasing over the last year (while the portions have gotten smaller). For example, if you get your order on DoorDash or Uber Eats, you'll pay 13% more than at a Chipotle restaurant because the chain started adding a delivery charge to digital orders. It also started charging for side tortillas, which used to come free upon request.

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Mura Dominko
Mura is a Deputy Editor leading ETNT's coverage of America's favorite fast foods and restaurant chains. Read more