900,000 Hospitality Jobs At Risk Without Government Support Says Trade Body

UKHospitality has warned of dire consequences stating that at least 900,000 hospitality jobs are at risk unless government offers a sector-specific package of employment support that helps businesses retain its workforce.

Giving evidence to the House of Lords Economic Affairs Committee on 15 September, UKHospitality chief executive Kate Nicholls commended the chancellor’s recent Plan for Jobs in assisting businesses to retain employees, but said the hospitality sector was facing enormous uncertainty in demand, with huge concerns about levels of trade as we go into the winter months.

“Part of the sector remain closed, a whole range of activities are permitted with the rest remaining substantially below capacity. As a sector we have utilised flexible furlough to get as many people as possible back in the world of work, but we are at a very delicate stage” she said.

Adding “We are concerned that this leaves at least 900,000 people in our sector at risk of redundancy without further support. The hospitality sector has a proven track record in delivering jobs growth. But we need the government to be flexible in its approach and to provide the necessary support over the bleak winter months in order for our sector to continue to play a role in the economic recovery”.

“Redundancies have risen, driven by Company Voluntary Agreements caused by landlords demanding rent payments,” says Nicholls. “Of those staff that remain, around half are back at work. A further 16% are on flexible furlough. Just over a third of the sector remains on full furlough. “ She concluded

The warning follows latest figures showed that the UK unemployment rate has risen to its highest level for two years, with those aged 16 to 24 suffering the biggest fall in employment in comparison with other age groups. Nearly 100,000 jobs were lost in hospitality over three months, despite the furlough system being in place.

UKHospitality is calling for support in the following areas:

Short term working – government to part-fund hours for businesses that have returned – up to 50% of wages for those back at work.

Local lockdowns – enhanced support for hospitality businesses that are closed (or part-closed) – to cover 50% of wages if remainder is paid by employer.

Bespoke financial support package for legally closed businesses – to include an ongoing allowance for staff, training and rent.

Fully-funded training packages for employees in depressed areas like city centres.