Hospitality Staffing Shortages Reach Record High

Hospitality sector staff shortages are at a record high, despite thousands of jobs being created in the sector over the past year, according to latest ONS labour market figures published this week.

Figures released by the ONS show that the hospitality sector is experiencing 83% more vacancies across the sector compared to March-May 2019 (the most recent comparable period). At the same time, the sector has created nearly 300,000 new jobs over the last 12 months, equal to one-in-three of all new jobs.

The figures highlight how, despite an improving post-pandemic performance, sector recovery is being thwarted by a shortage of staff.

According to the new figures, hospitality presently has 174,000 jobs available, a record high, in a climate where those out of work and wanting a job have fallen by about 130,000 over the same period.

UKHospitality CEO, Kate Nicholls, said:

“These figures show that the hospitality industry continues to return to growth and is attracting new people into the workforce. However, high vacancy rates are impeding our ability to trade. This is particularly concerning as we enter the summer, a key trading period for much of the sector.

“Last month UKHospitality launched its Workforce Strategy in order to tackle this and we have set out a coherent plan to solve some of the issues, including working with colleges and universities to attract students into work this summer and demonstrating how flexible working will provide opportunities for carers – but we need Government support.

“The points-based system needs to be tweaked to make it easier for seasonal and lower skilled workers to enter the workforce and the apprenticeship levy should be freed-up to help us attract the workforce we need to recover and grow.”

Wages have also increased across the board as businesses scramble to both recruit and retain talent, according to UK Hospitality’s Next Challenge, a new study from Barclays Corporate Banking. The research shows more than nine in 10 (94%) of business surveyed are struggling to recruit personnel, with vacancies for cleaning (20%), front-of-house (18%) and delivery staff (16%) causing the most issues.

Almost a fifth (16%) of bars and restaurants are finding it difficult to hire waiting staff, and nearly half of gyms and leisure centres (42%) cannot find fitness instructors. In response, new incentives have included permanent flexible working arrangements (by 23% of businesses) and increases in staff welfare budgets and bonuses (both 22%). Almost one in five employers (19%) have staff wages, with senior managers getting an average increase of 7.7%, delivery riders 7.5%, housekeeping staff 7.4%, bar staff 7.3%, finance staff 7.3% and kitchen staff 6.9%. Another concern is rising costs, with businesses reporting average transport bills spiking by more than 38% year-on-year, and utility bills by 37%.

All of which looks set to stifle the growth the majority remain confident of experiencing in 2022, says the report. More than three quarters (77%) of operators surveyed are confident of growth this year and predicted an average 30.5% uplift in revenue compared with pre-pandemic levels. This equates to a £36bn rise in annual turnover over 2019, and a £54bn increase on 2021.

The report went on to say that profit margins are now at 41.3% on average, compared to 39.1% pre-pandemic, with caravan parks enjoying the biggest rise in profitability, from 37.1% in 2019 to 48.0%. The report also found support for offering employment to Ukrainian refugees is particularly high in Northern Ireland, where 88% plan to hire them, as well as in the east of England (87%) and Scotland (86%).