UK hospitality sector could be worth £100 billion by the end of 2018, despite closures and staff shortages
UK hospitality businesses will exceed £100 billion this year and that the industry has steadily grown at around 6% for the past five years, new analysis suggests.
The total turnover of all businesses in the hospitality industry reached £98 billion in 2017, up from £92 billion in 2016 and £86 billion in 2015, according to figures released by the ONS.
Based on this rate of growth, recruitment platform Adia expects this figure to comfortably reach £100 billion in the ONS’ 2018 data, which is expected to be published in the autumn.
The amount of firms providing accommodation and food services activities in the UK has grown by just under 20% in the last five years, having reached 202,060 – up from 169,235 in 2013.
The news comes despite numerous reports of bar and restaurant groups being forced to close their premises amid staff shortages and a challenging market as the UK reaches its Brexit deadline.
Last week, Texture Restaurant Group sold the Fetter Lane branch of its wine-focused restaurant chain 28°-50° to Cliffords Restaurant Limited following rumours it could close all three of its sites.
Soho institution The Gay Hussar, a favourite of Labour leaders, became the latest casualty of the London dining scene on the same day, after a five-year battle to save the troubled venue from closure.
Around 330,000 staff currently working in the UK hospitality industry are considering leaving the UK due to Brexit, according to a recent YouGov poll.
Almost 1 in 5 (18%) of hospitality managers reported that recruitment had been harder now than in April 2017, with 16% believing they will not be able to fulfil their staffing requirements over the next five years with domestic workers.
Restaurant groups in particular are feeling the strain in the UK’s current economic climate. Profits of the UK’s top 100 restaurant groups fell by a collective 64% in 2017, with 35 now loss-making – up 75% in just a year – according to research by accountancy firm UHY Hacker.
Adia CEO, Ernesto Lamaina, said the hospitality sector plays a “valuable role as employers and job creators” in the UK economy.
“Our analysis indicates that the amount of people working in the sector has increased by over 409,000 in the last five years, which is testament to the health of the industry. However, as we’re seeing across the entire economy – the way we’re working and employing is changing. Employees expect flexibility and often, employers require it – businesses must respond to that.
“We believe the ‘now economy’ is a system where companies can more efficiently manage staffing costs, and people are free to pursue the roles they want.”