Sector disappointed by lack of wage support, but hopeful for further measures

19 March 2020 by
Sector disappointed by lack of wage support, but hopeful for further measures

The hospitality sector was disappointed last night by the lack of forthcoming support by the government to enable businesses to pay employee wages through the coronavirus crisis, but hope remains that further measures could be announced today [19 March].

UKHospitality chief executive Kate Nicholls tweeted yesterday following the prime minister's briefing: "Continuing to work with unions, business leaders and ministers to deliver a solution that secures jobs and incomes and removes the fear. Fingers crossed."

However, Stuart Procter, chief operating officer of the Stafford Collection (comprising the five-red-AA-star, Stafford London hotel in St James, the four-red-AA-star Northcote hotel in Langho, Lancashire, and Norma restaurant in Fitzrovia) described it as "poor leadership".

One million jobs will be at risk across hospitality businesses if the government does not urgently introduce a plan to protect livelihoods, according to UKHospitality.

The trade body and the sector's employers yesterday [18 March] called for an immediate package of support to be introduced within 24 hours to prevent mass redundancies. It has predicted that between 200,000 and 250,000 positions have already been lost.

Kate Nicholls, CEO of UKHospitality said: "While the extra measures announced yesterday represent significant help that will give many companies a lifeline, the massive issue remains people and preservation of jobs. What was announced by the chancellor yesterday will not stop job losses as companies will be very worried about taking loans to pay staff when they have zero income – for many, it just isn't viable.

"Our estimate is that across the hospitality sector, in the two weeks since the impact of the coronavirus was truly felt in the UK, this industry has shorn between 200,000 and 250,000 jobs, with majority of these cuts coming in the past few days – and many, many more will be lost in the coming days, without help.

"Our analysis suggests in excess of one million jobs are now on the line. Companies are having to make very difficult decisions now and with many hospitality and leisure businesses now having to choose to close or reduce their operations, there is little chance of saving many jobs without massive help. What the sector urgently needs is a package of support and funding to keep people in employment. This needs to happen now."

Procter told The Caterer that support from government was needed today [18 March].

Speaking after a West One conference [of hotels in Mayfair and St James, including the Dorchester, Claridge's and the Connaught], he said: "We need the government to support wages, not just in London but across the country. Without it more jobs will be going by the weekend."

Procter said he welcomed the announcement of a 12-month business rates break and £330b loan facility, but that it did not go far enough to protect livelihoods.

He added: "It's all about the staff. In four months' time we will have another staffing crisis because of Brexit. Three weeks ago we were in the midst of a staffing crisis and it will come back."

Tim Foster, founder of Yummy Pubs, said: "It needs to be today [13 March] and they need to do something similar to France with 70% guaranteed. They need to step up and help because I am hearing horror stories in the sector of general managers having to call 30-odd team members and make them all redundant."

He added: "It's a war zone out there from what I'm hearing and we're doing everything to keep our people but it's the government's responsibility to step up."

How to cope in a crisis: advice for business leaders >>

Hotels move to reduced hours, closures and temporary leave to preserve jobs >>

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