Hospitality sector remains in ‘fragile state’

By James Lawrence

Published: 15 September, 2021

Following the UK government's unveiling of its strategy for managing Covid-19 during the autumn and winter months, UK Hospitality (UKH) chief executive Kate Nicholls has issued a stark warning about the importance of allowing businesses to remain open.

This came in response to Boris Johnson’s speech yesterday (14 September), when he emphasised the continuing success of the vaccination programme, but allowed for a return to harsher restrictions, even a possible fourth lockdown, if the NHS becomes overwhelmed.

In a statement from UKH, Nicholls said: “It’s critical for the recovery of the hospitality sector and the wider economy that businesses are allowed to continue to operate in viable conditions throughout this winter.

“Hospitality venues are still in a fragile state with significant debts, making their first steps on the road to recovery and rebuilding broken balance sheets, any setbacks over the coming months will result in more businesses closures, she added.

“We must caution Government that the introduction of those measures that are left in reserve for this winter, would have significant and drastic impacts on the sector. The use of vaccine passports, logistically unworkable and with questionable effectiveness, will have a devastating effect on nightclubs and large-scale events.”

Meanwhile, the ONS has released a new set of data which confirms that the industry's staffing crisis has not abated.

According to the data, the hospitality’s sector vacancy rate is twice that of the economy as a whole, despite the sector creating 122,000 new jobs between March and June 2021.

“The latest official job numbers underline the significant impact the ongoing tightness and disruption to the labour market and associated labour shortages are having across the economy. However, hospitality is clearly suffering most when compared to other sectors,” said Nicholls.

“The industry has been at the forefront of job creation as the economy begins to recover and rebuild. But with additional pressures and uncertainties, as well as being the last sector to reopen, hospitality has been hamstrung in its attempts to fill vacancies.”

In July, the government's business minister Paul Scully unveiled a new 'Hospitality Strategy' to help the industry recover and thrive after the pandemic. It was premised on helping businesses get back on their feet, by focusing on the “three Rs’ of reopening, recovery and resilience.”

According to UK Hospitality, almost 10,000 licensed premises have closed since March 2020, waving goodbye to more than £87bn in sales.

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