Rail strikes ‘cost UK hospitality sector £1.5bn in December alone’ | Hospitality industry

Rail strikes have had a bigger than expected impact on the UK hospitality industry – costing bars, pubs, restaurants and hotels £1.5billion in December alone – according to the head of the body representing the sector .

Kate Nicholls, chief executive of UKHospitality, said it had contributed to a “perfect storm” for businesses struggling with high energy bills and a cost of living crisis, adding that it meant “no doubt we will see no more business failures” over the next three months.

She said recent railway strikes had hit the sector hard, prompting a wave of cancellations of Christmas parties and dinners during the week of December 12.

The industry body had estimated the strikes in December and January at £1.5billion, but now claims recent industrial action has led to losses of this magnitude in the last month alone.

Nicholls told BBC Radio 4’s Today programme: ‘December’s success has been more significant than we anticipated in terms of lower high street consumer footfall throughout this week.’

Railway unions led by the RMT have staged a series of strikes since June in a dispute over pay and working conditions. Several more strike days are scheduled for next week, when the RMT is expected to act again for four days, while the Aslef union, which represents the drivers, organizes a strike on January 5.

UKHospitality has tracked money from checkouts and cancellations across the sector.

Nicholls said that after the train strikes were announced for the week of December 12, “we have seen cancellation rates of up to 50% to 60% in central London, and 20% to 30% in the rest of the country directly attributable to these strike days”.

Town and city center footfall data showed sales on strike days across the UK were down 27%, she said, while in central London and the City , they had fallen by 46%. Nicholls added that this has happened throughout the year, since strike dates were first announced in May.

Around 2,500 hospitality establishments were forced to close in the last quarter and that trend is expected to continue into the new year due to the high cost of doing business, the UKHospitality boss said. “You have businesses in a perfect storm with skyrocketing energy bills, high input price inflation above 20% for the first time and the cost of living crisis hitting consumer confidence.

“It will undoubtedly be a very difficult first quarter for hospitality. It’s traditionally a much quieter season for us – January, February – traditionally you get 70% of the normal trades in those two months, whereas in December it’s 130% of the normal month trades, so much more profitable sales in December are lost. This means that these companies are much more vulnerable and fragile in January. »

She called for more government support on energy prices beyond April, when the current price cap ends.

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