Business investment in the hospitality industry HALVED in Q1 on an annual basis, analysis of the latest ONS data by business tax relief specialists Catax reveals.
Business investment by hotels and restaurants collapsed 52% (£702m), falling from £1.4bn in Q1 2020 to £649 between January and March.
This was a 27.7% fall on the previous quarter and a long way off the sector’s all-time high of £2.2bn in Q4 1997.
It was also dramatically worse than the performance of UK industry as a whole. UK business posted a 16.9% annual fall in business investment across all sectors in the first quarter, dropping an estimated 10.7% on a quarterly basis to sit 17.3% below pre-pandemic levels (Q4 2019)2.
By comparison, UK GDP shrank 1.6% in the first quarter, down 6.1% year on year and 8.8% below pre-pandemic levels at the end of 20193.
Mark Tighe, CEO of business tax relief consultancy Catax, comments:
“The hospitality industry hasn’t been out of the news over the past 18 months as the sector’s woes have closely tracked the nation’s fitful attempts to rid itself of Covid restrictions.
“The end is now finally in sight and, with it, the sector should see the back of such dramatic variations in its levels of business investment. A long-awaited recovery is well on the way.”
