Over three-quarters of UK hospitality businesses at risk of insolvency
04 August 2020
Posted by: Chris Banks
UKH survey highlights scale of crisis still facing hospitality sector as trade body warns jobs losses will follow without further Government support
More than three-quarters of hospitality businesses in the UK are at risk of insolvency within 12 months, according to UKHospitality.
A survey by the trade body, in partnership with CGA, showed that 1-in-5 are at significant risk of insolvency, or expect insolvency, within a year. Over half of businesses believe there is a slight risk, while fewer than one-quarter of hospitality businesses are facing no risk.
UKHospitality is warning that unless further decisive support is provided by the Government, many businesses will face ruin, with hundreds of thousands of jobs at risk.
Commenting on the figures, UKHospitality Chief Executive Kate Nicholls said: “These new figures underline the scale of the impact of COVID-19 on our sector and paint a truly stark picture of its immediate future.
“Over three-quarters of businesses in a sector which, pre-COVID, employed more than 3 million people, have some risk of insolvency within a year. Worryingly, over 20% are looking at a serious risk of insolvency or are now expecting it to happen. This is a truly desperate position to be in.
“The future of this sector, which provides jobs in every region of the country and is central to our social lives, has never looked shakier.
“The support the Government has provided has been crucial in ensuring that many businesses have survived the initial shock of lockdown and stimulated a return of some demand. Without further support, however, we are going to see more and more venues going out of business and people continue to lose jobs.
“This means we need to see an extension of the busines rates holiday and VAT cut, employment support for those businesses unable to open and financial support on rent. Otherwise, we are going to see businesses fail and jobs lost just as the economy begins to reopen.”