Leaders in the UK hospitality sector have reported that over half of the job losses since the last budget are attributable to their industry. Analysis from UKHospitality, which represents approximately 123,000 venues, indicates that around 89,000 jobs have been lost in restaurants, bars, pubs, and hotels since October. This figure accounts for 53% of all job losses in the country, suggesting the hospitality sector has been significantly impacted.
The group attributes these job losses to higher taxes announced in the Autumn Budget by Chancellor Rachel Reeves, which have affected investment and hiring within the industry. UKHospitality is calling for “urgent action” to reduce business rates and VAT to alleviate the financial strain on these businesses.
Amid these challenges, the UK Treasury has responded by extending business rates relief and decreasing licensing costs to facilitate al fresco dining in more establishments. However, UKHospitality estimates that job losses could reach 100,000 by the next budget. Currently, about 4.1% of all jobs in the hospitality sector have been affected, leading to operational adjustments such as reduced opening hours and site closures.
Mark Wrigley, owner of a bar in Manchester, shared his experience of halting his salary to manage rising operational costs. The immediate increase in the minimum wage has placed added financial pressure on employers already dealing with higher costs for goods and services.
Recent reports indicate that inflation in the UK is at its highest level since January 2024, primarily driven by increases in airfares and food prices. This increase in living costs has led to decreased consumer spending in the hospitality sector, further affecting sales and profits.
According to the Office for National Statistics (ONS), job openings have declined by 5.8% across various industries, particularly in hospitality and retail. There is evidence that some firms are hesitant to recruit new employees or refill vacant positions. The ONS noted that the number of employees on payroll has fallen in 10 of the last 12 months.
Source: https://www.bbc.com/news/articles/c05ey2ypp92o?at_medium=RSS&at_campaign=rss