Hospitality in decline

It’s been a week since London went into tier two of the lockdown restrictions. In that time much has been made of its effect on the hospitality sector.

Pubs and restaurants have born a lot of the brunt of the national lockdown, mostly relying on small business support and the furlough scheme to help pay their way through the pandemic.

Paul Easterbrook, manager of The Prince in Stoke Newington, has commented that it’s the difference in nature between going out with family or friends that has the most effect:

“two tables which might have consisted of six friends having a meal and multiple rounds of drinks into the evening, now consist of two sharing a meal and perhaps a bottle of wine over the same period.”

Questions remain over the effect the new restrictions will have on the labour force of the industry. An impending economic crisis does not bode well for staff in an environment famed for its zero-hour contracts and ‘minimum wage topped up by tips’ pay.

It is often the job of choice for those seeking a ‘stop-gap’ whilst they plot their next step but also contains management who work in this industry as a long-term career. It might be those who suffer the most as venues close and the preference for experienced staff (with higher wages) becomes less tenable.

Ever-increasing unemployment will only further heighten the amount of people looking for jobs within hospitality with the added effect of less wages to be shared out amongst the UK’s fourth largest industry by employment.

 

Easterbrook states:

“my immediate concern is for that of my staff; being able to provide the necessary hours in order for them to make enough to live on. If this is to go on for a sustained period of time my concern would be for the pub itself, as the question of whether or not this remains a viable business will be asked.”

 

In response to criticism of how little support remains available to business effected by the tier 2 restrictions Chancellor Rishi Sunak has updated the Part-time Job Support Scheme those businesses can apply for, yet some businesses would still rather be in tier 3 as it offers more financial support.

Taking the onus from the employer, the scheme now demands that the employee works 20% of their weekly hours, for which the employer will pay 5% of the hours not worked and the government will pay 49%. Worryingly the 74% of wages that the employee would receive is likely to create significant financial stress for those already struggling to live in our famously expensive capital city. Monthly grants of up to £2,100 are also now available for companies in the hospitality sector to apply for.

If the threat to employees isn’t scary enough, Easterbrook highlights the threat to businesses:

 

“venues are operating at limited capacity. A decrease in group sizes, in spend per head, whilst paying a much higher salary percentage to meet the table service requirements doesn’t help that the cost of running a venue has remained virtually the same throughout.”

Copy by William Murray, sub-edited by Jessy Noble

 

 

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