The hospitality sector entered a storm in 2020 with the rise of Covid-19 and lockdowns and five years later it still shows no sign of abating.
Pubs have traditionally been the centre of the local community in villages and towns for generations but as drinking and living habits change, their numbers have gone into steep decline.
Over the past five years, 2,074 pubs have closed – the equivalent of nearly eight a week.
| England & Wales | Number of pubs | Pubs Closed |
| 2020 | 40,617 | 446 |
| 2021 | 40,173 | 444 |
| 2022 | 39,787 | 386 |
| 2023 | 39,401 | 386 |
| 2024 | 38,989 | 412 |
| Total | 2,074 |
London lost the most pubs last year with 55, more than one a week, with 53 closing in the West Midlands.
Alex Probyn from the Altus Group which collated the data said: “Many publicans that I speak to are extremely worried that this could be their last Christmas given the combination of hiking the amount employers will have to pay in National Insurance, increases to the minimum wage and the business rates discount being cut from 75% to 40% in 2025.
“Many pubs simply will no longer be viable making plots even more attractive for alternative investment.”
Emma McClarkin, chief executive of the British Beer and Pub Association (BBPA), has called for more support from ministers especially on the looming business rates reduction.
She said that brewers and pubs “pour billions into the economy and support more than a million jobs.”
“For the sector to remain a stalwart of the economy and continue to be the beating heart of our communities, the Government must swiftly deliver permanent and meaningful business rate reforms.
“We stand ready to help the government bring in sorely-needed change that will break down the barriers that stop our sector from contributing even more to the economy and employing more people than ever before.”
Nightlife but for how much longer?
The UK’s nightclub sector is also battling alarming and historic declines.
The Night Time Industries Association (NTIA) have published their own research that showed a 32.7% decline in activity since 2020 with the recovery being in a “deeply fragile” state.
Michael Kill, chief executive of the NTIA, said the policies implemented in this year’s Autumn Budget have only increased fears within a sector that needs more support with NTIA research revealing that a majority of those in the sector are facing 30% to 40% higher operational costs compared to pre-pandemic levels.
He said: “While we’ve seen some recovery during the golden quarter (October to December), the reality is that our sector is still deeply fragile.
“We’ve already lost hundreds of businesses across the night time economy, who are struggling with unsustainable cost increases, including soaring energy prices and significant increases in wags, NICs and duties.
“The uncertainty heading into 2025 is more concerning than anything we saw during the pandemic. The Chancellor must step up with considered support to help businesses survive and protect jobs.
“The long term strategy rhetoric is important, but there must be a recognition and consideration for the immediate challenges, which are substantial, as we risk further closures and job losses. This environment for many is unsustainable.”
2025 will bring food for thought for restaurant owners
1,409 UK restaurants entered insolvency up to 30th September 2024, up from 1,180 in the previous period – an increase of 19%.
There were 363 restaurant closures in Q3 2024 and 370 in Q2 which was the highest quarterly total in a decade.
Chris Horner, Insolvency Director with BusinessRescueExpert, said: “Insolvencies in the hospitality sector are continuing to rise with a sharp rise in restaurants entering insolvency in the past six months.
“Like most high street businesses, restaurants operate on profit margins of just three to five per cent, which means that they often walk a balance sheet tightrope from one quarter to the next. Even if they have had a decent festive season, many will be looking at the minimum wage and employers’ national insurance rises on April 1st with trepidation.”
If you’re in the hospitality business – whether it be a pub, restaurant, bistro, nightclub or any other venue – and can see nothing but storm clouds on the horizon this year then get in touch with us.
We offer a free initial consultation for any director or business owner to discuss their situation and circumstances and to explore what options are available to them and their company.
The sooner they get in touch, the more leeway and choices they will usually have so find out what we can bring to your menu today.