A quarter of pubs and restaurants fear they will collapse before Christmas without further government support, according to a large-scale investigation that warns the pandemic could cost 675,000 hospitality jobs by February.
As new analysis has shown more than £ 750million in late-night income could be affected by the imposition of a 10 p.m. curfew, hospitality companies have said they are “Adrift” and now face the prospect of going bankrupt.
They predicted that the new curfew rules – which could last for six months – would make matters worse.
Almost 23% of pubs, bars and restaurants said they plan to fold within three months without a financial package for the sector, according to a survey commissioned by the British Beer & Pub Association, UK Hospitality and the British Institute of Innkeeping.
One in eight hotel workers have already been made redundant, and more jobs are set to be lost permanently when the leave program ends in October.
On average, companies estimate their workforce will be 25% smaller in February 2021 than it was a year earlier – a drop of 675,000 jobs.
The survey, conducted for trade organizations by industry analyst firm CGA and reported by ITV, reveals grim predictions shared by owners of pubs, bars and restaurants, even before the imposition of the cover. 10pm fire.
“This research shows that advertising companies were already on the edge,” said Emma McClarkin, CEO of BBPA.
“Now that the Prime Minister has announced even more restrictions for them, it is clear that the government will need much more support to ensure their survival.
“An immediate stimulus package is needed for our sector in the form of an extension of the holiday scheme and a reduction in corporate tariffs, as well as the further reduction of VAT on free food and beverages. alcohol and a significant reduction in the excessively high beer tariffs in the UK. ‘
Kate Nicholls, Managing Director of UK Hospitality, said: “The future of the industry is still very uncertain.”
“The additional restrictions announced this week place an even greater burden on an industry that operates on razor thin margins and needs all the help it can get. It is essential that these restrictions are reviewed regularly. “
The investigation emerged as new analysis for the Guardian indicated that more than £ 750million in sales could be at risk if curfew restrictions last for six months.
Reviews from chain pubs and casual restaurants suggest they account for up to 4% of their sales after 10 p.m., according to veteran analyst Mark Brumby, with bars racking up nearly a quarter of their sales during that time.
Based on data from the hospitality industry, which includes more than 100,000 pubs, bars and restaurants, around £ 32million goes through their checkouts during these hours each week, Brumby said.
This means that sites could normally expect to register revenues of over £ 768million after 10pm over six months.
Brumby, of consultancy firm Langton Capital, said some customers would choose to eat or drink earlier in the evening, which means not all that money will be wasted, especially in restaurants. But he warned that some pubs and bars that earn a significant portion of their income after 10 p.m. “will suffer horribly”.
He also pointed out that the order means sites must close by 10 p.m., forcing most to stop making sales in advance to ensure customers are gone on time for the deadline.
Business bodies such as UK Hospitality and the British Beer & Pubs Association (BBPA) have slammed the plans, questioning scientific evidence on them and warning people leaving the premises at 10 p.m. will go to homes where social distancing is not applied.
They reportedly lobbied the government on Wednesday, warning that the curfew could lead to thousands of job losses and business bankruptcies.
UK Hospitality chief executive Kate Nicholls said this week that a curfew risked devastating an industry ‘already on its knees’, while Wetherspoons founding president Tim Martin called the measure’ completely stupid”.
“There seems to be little evidence available that pubs, with their strict adherence to government guidelines, are not sure, so we’re not sure this comprehensive measure will make a major difference,” said Emma McClarkin, CEO of BBPA.