Nearly 300,000 jobs in the ailing hospitality trade will be lost unless the government moves quickly to save them with a sector-specific bailout, some of the industry’s largest pubs and restaurant groups have warned the prime minister.
With venues subject to restricted capacity and a controversial 10pm curfew, industry trade body the British Beer & Pubs Association forecast a jobs bloodbath.
A report for the BBPA by consultancy Oxford Economics found that 291,000 roles – a third of the total in the sector – are at risk of disappearing, with people under 25 likely to be disproportionately affected.
The forecast is based on industry data suggesting that 25% of pubs could close, with the remainder barely breaking even as they struggle to cope with reduced custom and limited opening hours.
Oxford Economics said the worst-case scenario would reduce the sector’s economic output by £7.4bn and cut wages by £3.9bn.
The BBPA called on Boris Johnson to “change tack” and review the 10pm curfew every three weeks.
In a letter to Johnson, the BBPA said: “The 10pm curfew should be removed if demonstrably not working as intended or adjusted to provide for gradual dispersal and avoid the unintended consequences for the wider sector including cultural activities now impacted.”
The letter was signed by an array of major hospitality businesses in the pub and restaurant sectors, including Greene King, Heineken, JD Wetherspoon, Burger King and Pizza Express.
Data revealed by the Guardian earlier this week showed that the restriction on late-night trading has already sent sales plunging.
And new figures released on Friday offered further insight into the effect of the curfew, local lockdowns and the “Rule of Six” limit on social gatherings. Weekly sales were 23% below the equivalent period of last year, according to the Coffer Peach Business Tracker, with pubs that rely on drink sales down nearly 29%.
Week-on-week figures also offered a comparison between the week before new restrictions came in and the week after. They showed that while restaurant sales were little changed, sales in food-led pubs were down 11% and drinks-led pubs recorded a 15.3% decline.
The BBPA is also calling on the government to put together a sector-specific financial package to support the industry.
This would include an extension to a VAT cut for hospitality businesses and a business rates holiday through 2021, along with a significant cut in beer duty, lockdown grants and the removal of hospitality firms’ contributions to the job support scheme, in which employers cover more than half the wages of a staff member on the programme.
“It’s important to remember that outside of the current circumstances our sector is a thriving one – and when this epidemic ends it will be key to driving the economic bounce-back we will desperately need,” said the BBPA chief executive, Emma McClarkin.
“For that to happen though the government must invest in it now to ensure its still here to play that role.”
The BBPA’s grim forecast adds to growing pressure on the government to do more to protect jobs, going further than the job support scheme announced by Chancellor Rishi Sunak.
The BBPA’s warning came the day after dozens of firms in the exhibitions and live events industry wrote to the prime minister and chancellor, warning that 90,000 jobs could be lost within weeks without a “hibernation support package”.
The Events Industry Alliance is calling for support while they are unable to trade, including wage subsidies and a regular review of whether events could take place with Covid-19 protection measures in place.
The group also called for an enhanced system of grants and loans for the industry, as long as venues cannot open due to government-imposed restrictions.
“We are not an unviable sector and simply require support to survive until the time is right to resume events, at which point we can return to our role of driving growth in the wider economy,” they wrote.
“[…] Vital parts of the ecosystem needed to resume events in the UK will cease to exist in the coming weeks, with catastrophic employment consequences, if targeted government action is not taken now.”
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