Hospitality sector in freefall as restaurant closures soar
BRITAIN’S hospitality sector is in freefall, bosses have warned, as the number of restaurants going under jumps by almost 50pc.
The Treasury is facing mounting pressure to act to protect restaurants and pubs this winter as Sacha Lord, the night time economy adviser for Greater Manchester, warned that the situation “will only get worse over the months to come” for the hospitality sector.
By the end of August, 158 restaurants had collapsed into liquidation, a 46pc rise June when 108 had gone into liquidation, as businesses were hit by spiralling food and drink costs, higher energy bills and steeper wages.
Mr Lord said the sector was in an “extremely worrying state” and called for urgent support from the Government, before the Autumn Statement from Jeremy Hunt, the Chancellor, on Nov 17.
He said: “There is a severe lack of confidence among operators, particularly those running small independent businesses, and this has been exacerbated by the confusion over possible business support and ongoing U-turns.”
It comes weeks after Mr Hunt threw out plans to freeze alcohol duty, putting pubs and restaurants on course to increase their prices even more sharply early next year. The Government had planned to implement a one-year freeze from February 2023, which would have saved drinkers 7p on the price of a pint and 38p on a bottle of wine. But Mr Hunt pulled the plans in the minibudget bonfire.
The British Beer and Pub Association described the move as a “huge blow to brewers and pubs” that would force widespread price increases. The price of a pint already surpassed £8 for the first time in June with the average cost of a drink jumping by 70pc since the 2008 financial crisis, according to data from the industry tracker CGA.
Rising prices have hit footfall in pubs and restaurants, with more than three quarters of hospitality companies reporting a slump in people eating out. Separate figures from industry body Ukhospitality from late last month suggested that 35pc of businesses were expecting to either be at a loss or unviable by the end of the year.