Tourism industry in ‘crisis’ as businesses struggle to find staff

Staff shortages in the north’s tourism industry are reaching a “critical” level, the Federation of Small Businesses (FSB) has warned.

Almost half of business owners questioned said they were having to cut their hours and services because they did not have enough workers.

And one in 10 were “barely staying afloat”.

David Richardson, FSB Highlands and islands development manager, said the issue should be “exercising minds most.”

He added: “Staff shortages have been a growing problem for years even with a plentiful supply of EU workers but now the situation is becoming critical.

“Businesses are struggling, and in many cases failing, to recruit people from anywhere – locally, the rest of the UK, or overseas – and two in five have increased pay to help.

“Sadly, however, staffing shortages in tourism and hospitality are a national and international problem rather than something purely local.”

The FSB survey found that the anticipated postlockdown staycation boom did not start as soon as travel restrictions were lifted, leaving 40% of businesses struggling to generate sales.

A tenth of respondents said they were struggling to stay afloat and a quarter expressed pessimism about surviving until next year.

The survey was carried out between May 25 and June 4, among businesses in the Highlands and Islands Enterprise (HIE) area, including Highland, Moray, Outer Hebrides, Northern Isles, Argyll and Arran, producing 290 responses.

Results showed areas on the NC500 road trip route around the north Highlands were doing best.

They also suggested the west coast was faring better than the east of the area, while Shetland was the weakest performer.

The FSB is calling for the Scottish Government to commit to a range of moves, including ending physical distancing and self-isolation once most adults are fully vaccinated.

It also wants Holyrood to pilot a remote visa system for employers in the Highlands and islands.

Mr Richardson said: “While the ambition has always been for the Highlands and islands to have a truly mixed economy, the fact is that most of this vast region is dependent, directly and indirectly, on tourism.

“The fact that almost half of all tourism and hospitality businesses across the region are struggling is a matter of grave concern.”

He added: “This is the time of year when these linchpin businesses must build up the cash reserves needed to carry them through the long winter, undertake essential repairs and refurbishment, and start paying off any debts resulting from Covid loans.

“They simply cannot afford to be operating on ‘slow’.”

There were warnings last month that the north faced problems meeting the anticipated surge in tourism. HIE has announced funding plans to help the sector.

Eilean Donan Castle, Dornie, which is on the NC500.