How technology could help solve the labour elasticity crisis

For the modern catering and hospitality leader, 2026 is a year of managing ‘the squeeze’. On one side, consumer confidence remains under heavy fire – inflation since 2022 is approaching 25%, and the GfK Consumer Confidence index shows a dismal -31 for the general economic outlook. 

On the other, the operational cost of delivering a service has never been higher. With the National Minimum Wage now at £12.71 and the 2025 hike in Employers’ National Insurance contributions, the break-even point for a single event or service shift has moved significantly down-field.

In this climate, the Agility Gap – the space between the flexibility a catering business needs and the rigidity the law now imposes – is becoming a critical threat to survival.

The legislative end of the buffer

Historically, the hospitality sector relied on zero-hour contracts to handle the bullwhip effect of seasonal bookings, wedding seasons and corporate events. However, the Employment Rights Act (ERA) has effectively dismantled this safety net.

As the legislation matures into 2027, workers on zero-hour contracts gain the right to request permanent employment after just 12 weeks. For a catering company that scales up specifically for a three-month summer season, the risk of being locked into fixed labour costs during the quieter Q1 period is a genuine threat to P&L. Combined with day-one rights for sick pay and parental leave, every ‘bad hire’ now carries a significantly higher carry-cost and potential legal risk. In an industry where a single no-show can derail an entire service, the friction of finding reliable talent is at an all-time high.

Moving beyond the agency band-aid

The traditional solution – temporary employment agencies – is also reaching a breaking point. While agencies provide ‘warm bodies’, they often fail on the metrics that actually matter: service speed, technical skill and client satisfaction.

In high-pressure catering, the lack of a direct feedback loop is a productivity killer. Agency staff often lack the skin in the game required for high-stakes environments, leading to a dip in morale and an increase in service errors. Furthermore, with 2.8 million people currently inactive due to long-term health conditions and a shrinking pool of younger workers, the reliable server or skilled prep chef is becoming a rare breed. When quality drops, the brand reputation – and the repeat booking – suffers.

The rise of accountable elasticity

The path forward for 2026 requires a shift toward accountable elasticity. This means moving away from opaque agency pools and toward transparent, digital marketplaces where performance data is the primary currency. By engaging a freelance-based workforce, catering firms can tap into a demographic of hospitality professionals who are incentivised by their own digital reputation. When a worker knows their rating directly affects their ability to book future high-value shifts, the correlation with punctuality and service quality is immediate.

The Temper solution

This is where a digital marketplace for work can add value. Temper connects hospitality businesses with more than 175,000 experienced freelancers, restoring the floor agility that legislative changes have eroded. In 2026, the most resilient catering operations won’t just be those with the best menus, but those with the most adaptable human capital.

Alex Rose is chief executive UK at Temper