Today’s Company Insolvency Statistics show accommodation and food service insolvencies fell 16% month-on-month in August 2024 (from 323 to 270) – the lowest monthly figure since January 2024 – and were down 29% when compared to the same month last year (380).
However, insolvencies in the sector increased 9% in the year to August 2024 (from 3,419 in the 12 months to August 2023, to 3,712 in the 12 months to August 2024).
Saxon Moseley, partner and head of leisure and hospitality at leading audit, tax and consulting firm RSM UK, comments:
“The monthly decrease in insolvencies will be welcome news for the industry. Hospitality businesses have experienced slow but steady revenue growth over the summer, while staff vacancies, food costs and services inflation have all reduced in recent months, pointing towards an easing of margin pressures which have put operators under significant strain.
“However, already this month businesses have had to factor in the new tipping legislation as well as get to grips with proposed changes to workforce practices under the Employment Rights Bill. There are growing concerns about how the Budget will impact consumer confidence and the cost of employing staff, which could have a detrimental impact on the sector. As an industry that employs a vast number of staff, any employment-related changes risk disproportionately impacting the sector.
“At a time where the industry is trying to get back on its feet following a difficult couple of years of trading, it’s imperative that the government treads carefully to avoid damaging its fragile recovery.”
