Chipotle raises prices of burritos, salads and more up to 4% as it boosts employee wages

It’s not your imagination. Your Chipotle burrito now costs more.

The fast-casual chain has raised menu prices between 3.5 and 4% to help offset an increase in employee wages, Chipotle Chief Financial Officer Jack Hartung said at the Baird Global Consumer, Technology & Services Conference Tuesday.

Chipotle announced in May it was hiring 20,000 new employees and raising its average hourly wage to $15 by the end of June. Starting pay will range from $11 to $18 an hour, the company said.

“We really prefer not to take pricing, but it made sense in this scenario to invest in our employees and get these restaurants staffed, and make sure that we had the pipeline of people to support our growth,” CEO Brian Niccol said at the Baird conference. “We’ve taken some pricing to cover some of that investment.”

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Niccol said the percentage increases equate to “quarters and dimes that we’re layering in.” 

With the increase, he said a chicken burrito was still “well below $8,” except for higher price markets like New York. In New York City, a chicken burrito costs $9.50 versus $7.65 in Fort Lauderdale, Florida or $7.75 at a Chipotle in Topeka, Kansas. 

Hartung said the industry was feeling inflation pressures, which are now focused on labor.

“Our approach was to get in front of this and lead, to first invest in our people and then to do the right thing,” he said. “It feels like the industry is now going to have to either do something similar or play some kind of catch up.”

McDonald’s also said in May that it was raising wages by an average of 10% at company-owned locations.

Hiring picked up nationwide in May as employers added 559,000 jobs amid falling COVID-19 cases, a loosening of business constraints and stepped-up vaccinations, more than offsetting persistent worker shortages.

Leisure and hospitality, the sector hit hardest by the pandemic, added 292,000 jobs in May as restaurants and bars rehired laid-off workers.

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Contributing: Paul Davidson, USA TODAY

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