Two years of Covid 'cost hospitality sector £115b'
The impact of the Covid pandemic over the last two years is estimated to have cost the hospitality industry £115b, according to UKHospitality.
The sector lost £114.8b versus what was expected for 2020/21. With a full 24 months of data available, hospitality, which in normal times generates up to £140b a year, lost 45 weeks of sales since March 2020.
On top of this, the sector is facing rising costs across the board and UKHospitality has urged the government to continue its support of the industry by keeping VAT at its current level of 12.5%, instead of returning it to 20% from April.
UKHospitality chief executive Kate Nicholls said: "These figures lay bare the utter devastation that two years of this terrible pandemic has wreaked on the third largest private sector employer in the UK, with thousands of businesses closed, many on the brink of collapse, and countless jobs lost. The last thing operators need – and which a lot of them simply wouldn't survive – is a VAT increase.
"Businesses big and small have been left with depleted cash reserves and crippling debt as Covid loans as well as contending with a gaping hole of 400,000 job vacancies, as more than 80% of hospitality businesses report they have roles to fill.
"Who'd have thought two years ago that we'd now be looking at a once vibrant and dynamic industry brought to its knees? Tragically, in addition to the devastating monetary losses are the damaging and long-term psychological effects on thousands of people in our sector who have lost their livelihoods and, in some cases, seen their life's work ruined.
"But two years on, and with all restrictions about to end, there are signs of hope and recovery. With government support, hospitality – which is full of energetic, creative and entrepreneurial people – must be at the vanguard of the UK's wider post-pandemic recovery."
The latest edition of the UKHospitality and CGA Quarterly Tracker found that hospitality enjoyed £17.3b (121%) final quarter growth in 2021 compared to the same period the year before.
However, that was still down 32.3% on the 12 months to the end of last December versus the 12-month period ending December 2019, the equivalent of a £43b loss across hospitality in 2021 against expected 2019 levels – the last full year with which to compare when there were no coronavirus restrictions.
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