US Economy

Where will my kids eat tonight? Inside America's food insecurity

Panera Cares Community Cafe opened in Center Plaza, with a pay-as-you-can approach. "I'm homeless and still gave, cause I want others to have," said Wayne Gilchrist, who lives under a bridge in Cambridge, Massachusetts.
John Tlumacki | The Boston Globe | Getty Images

Panera Bread opened a pay-what-you-like location in 2010 in St. Louis, Missouri, to much buzz—and some confusion. Customers and industry watchers scratched their heads, wondering how a menu with no fixed pricing would work.

The latest pay-as-you-wish operation debuted in Boston more than a year ago, and there are now five community cafes, called Panera Cares. The special cafes are the brainchild of Panera Bread Chief Executive Ron Shaich, and offer a case study in how a for-profit company is navigating philanthropy and bottom lines.

In addition to running a chain that includes 1,800 regular cafe-bakeries, Shaich has made battling domestic hunger and food insecurity a priority. Shaich (pronounced "shake") at one point lived on $4.50 a day. Food insecurity includes families who don't have reliable access to regular meals.

But whether the private sector can help solve food insecurity through scalable solutions remains to be seen.

"It's a mixed picture," said David Spielman, senior research fellow with the International Food Policy Research Institute. "A lot of companies have sustainability strategies. Not every company has the wherewithal to pursue real sustainable strategies, social or environmental," said Spielman of the Washington, D.C.-based group that's focused on studying hunger and poverty.

Researchers and for-profit companies are seeking solutions as domestic food insecurity remains at the highest recorded percentage—14.5 percent or roughly 17.6 million households—since the U.S. Department of Agriculture began monitoring the issue in 1995.

Read MoreIt's getting too expensive to be poor in America

It has been five years since the 2007-09 recession. But food insecurity remains stubbornly high. This despite lower unemployment levels because families now are battling higher inflation and rising food costs, according to a USDA update on food insecurity released last month.

"Food insecurity remains a problem," said Alisha Coleman-Jensen, a researcher with the USDA. Prior to the recession, the percentage of food insecurity hovered around 11 percent—3.5 percent below the current level.

"We've also seen some moderate income households that have food insecurity," USDA's Coleman-Jensen said.

Former Panera Bread CEO Ronald Shaich in front of Panera Cares in Boston, one of five pay-as-you-want community cafés.
Source: Panera Bread

As food costs have risen amid the recession's long tail, Panera Bread's community cafes have allowed staff to peer into the lives of Americans who are struggling to make ends meet. The cafes are designed to generate sales to cover operating costs.

Panera Bread CEO Shaich recalled one encounter with a tech writer, who had lost his job, and walked into a community cafe for an affordable meal. "I didn't know where my kids were gonna eat tonight," he told Shaich.

"It's not just about profits," said Shaich, who made the comments at the United Nations in New York in late May. America's broken food system was part of a broader UN summit on economic and environmental challenges. "We live off communities we live in," he said.

From Shaich's anecdotes to a slew of research, it's clear the face of America's hungry is changing.

"Those who are hungry aren't sitting on the street corner, shaking a can," says Kate Antonacci, director of societal impact initiatives for Panera Bread. "We have quiet populations who are food insecure. Many come from college, dual-income households," she said.

Said the USDA's Coleman-Jensen: "It's not so simple to say only poor households are facing food insecurity."

Food-insecure households are defined as those that lack consistent access throughout the year to adequate food for active, healthy lifestyles. About 5.7 percent of U.S. households7 millionhad very low food security, according to 2012 data, the latest annual analysis available.

Read More Who uses food stamps? Millions of kids, that's who

Panera's $42 million upgrade
Panera's $42 million upgrade

Panera Bread CEO Shaich said some customers have abused the pay-what-you-want cafes. But Shaich and his company are committed to understanding the magnitude of America's food epidemic, which includes a lack of transparency about ingredients.

Last month, St. Louis-based Panera Bread launched a comprehensive food policy, which includes a commitment to sourcing and serving food without artificial additives including artificial trans fat and MSG, a flavor enhancer.

"So many of us don't know the ingredients in our food," Shaich said. "Our food system is broken."

Looking ahead, food solutions that are likely to have the largest, long-term impact not surprisingly are community-based and specific to countries down to regional small farmers.

Said Spielman of the International Food Policy Research Institute, "There's huge potential for the corporate sector to do a lot."

By CNBC's Heesun Wee.