Hospitality Hiring Crisis Drives Up Wages By Up To 14% As Venues Turn To Temps To Keep Drinks Flowing

Hiring bottlenecks in the UK’s booming hospitality sector are increasingly prompting pubs and restaurants to turn to temporary staff to keep up with demand, and have forced them to increase wages by as much as 14%, according to Indeed Flex, the online marketplace for flexible workers.

Hospitality has been one of the sectors hit hardest by the pandemic, but it is now bouncing back strongly as customers rush to enjoy two pleasures that were denied during lockdown – a meal out or a drink with friends in the pub.

However, the decision to postpone ‘Freedom Day’ in England to July 19 is hitting the industry hard. Venues are caught in a bind as social distancing rules still oblige them to provide table service only – requiring extra staff – and limit the number of customers they can serve. The hospitality industry is likely to come under further pressure when the business rates holiday ends on June 30.

Analysis of pub, bar and restaurant shifts posted on the Indeed Flex platform reveals that temps willing to work at the weekend could benefit most from the rapidly rising wages. Average hourly pay for a weekend shift is now up 9% compared to this time in 2019.

Meanwhile weekday pay rates have risen by an average of 5% across the UK, far exceeding the 1.8% rise in the minimum wage between 2019 and 2021.

According to official ONS employment data, the food services and accommodation sector recorded the biggest spike in vacancies – up 265.5% – of any industry in March as lockdown restrictions first began to ease.

With so many venues scrambling to find the staff they need, businesses are turning to experienced temporary workers to fill rotas. But Indeed Flex’s data also reveals that businesses are paying more to attract the best people.

Pay increases vary around the country, however, with Greater Manchester and Cheshire seeing the biggest increases in pay. Hourly rates for temporary workers there have risen by 11.15% for weekday hospitality staff, and by 13.87% for weekend workers compared to May 2019.

Average pay increase for temporary hospitality workers in May 2021 versus May 20191

Region

Weekday pay increase

Weekend pay increases

Average increase

Greater Manchester and Cheshire

11.15%

13.87%

12.51%

Yorkshire

9.85%

12.56%

11.21%

Wales and South West

4.15%

11.12%

7.63%

Midlands

2.78%

10.30%

6.54%

London

3.72%

3.73%

3.73%

Merseyside

0.63%

1.05%

0.84%

Pay growth has been weakest in Merseyside, where hourly rates increased by just 0.84% on average, and in London, where they notched up by only 3.73%.

Jack Beaman, CEO and Co-founder of Indeed Flex, said: “The combination of booming demand from customers and the table service-only rule means thousands of pubs and restaurants need more staff – and fast.

“But with bottlenecks holding up the supply of workers, forward-thinking businesses are increasingly turning to temporary staff to fill shifts, and raising wages to woo the best people.

“We’ve also seen an influx of people opting for temporary work as a post-lockdown lifestyle choice – as it gives them a variety and a work-life balance that a permanent job cannot.

“Temporary workers offer hospitality businesses vital flexibility in the current uncertain trading environment in which customer demand is strong but margins are squeezed.”