THE second national lockdown could “obliterate” the hospitality sector and cost the economy up to £8billion a fortnight.
Although Boris Johnson last night announced that the furlough scheme will be extended into December, business groups fear it may not be enough.
The Government’s £50billion furlough scheme – which covers 80 per cent of employees’ wages – was due to finish yesterday.
But there are concerns thousands of landlords may still be forced out of business in the run-up to Christmas, which is traditionally one of their busiest times.
The cost of a second lockdown to the economy has been estimated at up to £8billion every two weeks, by the Institute of Economic Affairs think-tank.
It is feared that one in four pubs, restaurants and hospitality firms could go bust as a result.
Camra’s national chairman Nik Antona said the second lockdown was “a devastating blow for an industry that is currently on its knees”.
“Pubs have already invested thousands to reopen Covid- safe environments despite facing seriously reduced incomes. The new lockdown couldn’t come at a worse time,” he said.
“The Government must introduce a robust support package for all pubs and breweries – regardless of their current rateable value.
“While an extension to the furlough scheme is welcomed, it does not go far enough.
“We need more details of how much support will be offered along with a clear roadmap out of lockdown to ensure local jobs and businesses are not lost forever.”
Emma McClarkin, chief executive of the British Beer and Pub Association, said the lockdown “would be hugely damaging” and “destine thousands of our pubs and jobs to complete obliteration”.
And Gary Forrest, chief executive of north east hospitality chain, the High Street Group, told how he feare feared the festive season was going to be a “disaster”. He said: “People are trying to book Christmas parties, we don’t know if we can accept them. It’s tending towards being a total disaster.
“The hospitality industry cannot afford to have a poor December.”
The warnings come as images of panicbuying emerged, with shoppers stockpiling toilet rolls and other essentials in scenes similar to those experienced in
March. Helen Dickinson, chief of the British Retail Consortium, also warned that the retail sector would be facing a “nightmare before Christmas”.
She told how the second lockdown would cause “untold damage to the high street, cost countless jobs, and set back the recovery of the wider economy, with only a minimal effect on the transmission of the virus”.
Ms Dickinson added: “The previous lockdown cost ‘non-essential’ shops £1.6billion a week in lost sales.
“Now that we are entering the allimportant Christmas shopping period, these losses are certain to be much bigger.
“The Government must play its part, providing support to businesses forced to close, otherwise the consequences for retail will be dire.”
TUC chief Frances O’Grady said any new lockdown “will only work if people aren’t worried about their livelihoods”.
And Layla Moran, chair of the allparty MPs’ group on coronavirus, urged the Government to “break the cycle of ‘ boom and bust’ lockdowns”.
She added: “Only when the whole of the UK is Covid-secure will we be able to save lives long-term, restore confidence, secure jobs and open up the economy sustainably.”
Long-term unemployment fell to below 300,000 earlier this year, or less than one per cent of the workforce.
But the IEA fears a substantial portion of the 1.6 million people who registered for out-of-work benefits during the first lockdown could be left on the scrapheap for years to come.
The youngest and oldest workers will bear the brunt of the coming jobs disaster, according to the Learning and Work Institute think tank.
It says workers in manufacturing, construction, retail and wholesale will be worst hit, with lower-skilled staff particularly vulnerable if patterns from previous recessions are repeated.
This week, Channel 4’s Dispatches highlights the existing job crisis, following a job advert for a minimum wage server at Manchester restaurant, Peru Perdu.
Normally a job like this would get 20 to 30 applicants – but 947 applied.
Recruiter Abi Dunn said: “It’s a real indication of where the sector is at.
“There’s managers applying for roles, cabin crew applying, there’s people from lots of different sectors.”
Britain is already heading for its biggest budget deficit – where yearly spending outstrips tax receipts – since the Second World War, due to the soaring costs of the pandemic.
Annual borrowing is expected to hit £320billion by April – almost £5,000 a year for every man, woman and child in the UK.