Hospitality: problems and possibilities

As we all know, the hospitality sector has suffered a severe blow over the last two years. And while much of the sector is now experiencing a comeback, restaurants are still struggling to get customers through their doors.

And yet, the hospitality sector in general is at the heart of our communities and is uniquely equipped to drive economic recovery, employment and – in turn – the levelling up so often talked about by those in power.

Talking of those in power, how many of us could name five things that politicians are doing to help lift the sector out of the covid despair? Given the urgency of the situation, they should be looking at ways to optimise recovery and growth, by harnessing the power of the sector to drive the levelling up agenda.

Possibilities for growth

The hospitality industry is worth £130bn a year to the UK economy – more than the automotive, pharmaceutical and aeronautics sectors combined – and provides entry-level employment to millions of young people, as well as a livelihood for older workers who have established careers in the sector. The value of the sector to the economy is even larger when its impact on wider supply chains is taken into account, including taxi services, takeaways, food manufactures and breweries.

Prior to the pandemic, the hospitality sector was the third largest employer in the UK, creating one in six of all jobs and employing 6 million people (3.2 million directly). But hospitality went quiet as people stayed home in the name of safety. The event of Brexit at the start of 2021 made this situation even more dire, quickly followed by high interest rates leading to increased financial uncertainty amongst would-be customers.

But the roll out of the vaccination and people tiring of staying in, have played a hand in providing the sector with a much-needed boost, redirecting customers back into pubs and restaurants. Hospitality should be seen as the best way of kick-starting the economy.

Problems within the sector

Because so many hospitality businesses had to lay staff off or furlough them, many staff have left the industry to work in other sectors. This has led to a severe shortage of trained staff now that restaurants are re-opening. Couple that with problems in food supply chains and we see that some of the key areas of risk include bottlenecks in farm labour, processing, transport and logistics, as well as significant demand shifts.

It's time for politicians to step up and protect and promote the hospitality sector. We need a hospitality review to assess the needs of the sector, plan and promote training of staff and critically examine all the financial demands on hospitality businesses, 98% of which are small and medium sized enterprises (SMEs). Rates, rents, utility costs and supply chain issues all need to be critically examined. So we say to the powers that be, stop talking about levelling up and start helping the sector meet its potential.

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