Around 500,000 job losses in the hospitality sector since January

05 November 2020 by
Around 500,000 job losses in the hospitality sector since January

There have been around 500,000 job losses in the hospitality sector since January, according to figures from software provider Fourth.

The data reveals the impact Covid-19 continues to have on jobs, with a fifth fewer sector jobs compared to a year ago, with the latest study indicating that the number of job leavers continues to significantly outweigh the number of new starters, a trend seen throughout August and September since the industry began reopening following the first lockdown.

The study also found there has been a 21% drop in overall staff headcount compared to October 2019, and there were approximately three leavers for every one starter throughout the month. Meanwhile the total staff headcount across SMEs was down by 23.3% against October 2019, compared to 16.8% for large-scale national operators.

Fourth's data, which has been aggregated from analysis of more than 700 companies across the restaurant, pub, bar and quick-service restaurant (QSR) sectors, reveals that a further 21,337 hospitality workers lost their job in October, representing 7.5% of the total workforce.

The pub sector experienced the least impact, with a 5% reduction in workforce, followed by QSRs with a drop of 6%, and restaurants with an 8% drop. The hotel sector was most impacted, with a 10% drop in workforce.

Overall, the data reveals that the workforce shrunk by 21% in October 2020, versus the same month in 2019. Once again, the pub sector experienced the least negative impact, with a drop in labour of 18% over the course of the month. This was followed by QSRs, with a drop of 20%, and the restaurant sector with a 22% drop. The most impacted sector, again, was hotels, where there was a 24% reduction of labour when compared to last year.

Unsurprisingly, the data indicates that SMEs have been hit harder than large, national operators when it comes to reducing staffing levels, suggesting that they have been required to make staffing cuts sooner.

For national businesses, there was a drop in staff headcount of 16.8% compared to October 2019; this tracks against SMEs, where the data highlights a drop of 23.3%, versus the same period.

Sebastien Sepierre, managing director – EMEA, Fourth, said: "October was another incredibly challenging month for the hospitality sector, with further government-imposed restrictions impacting trading and consumer confidence. While entering a second lockdown is incredibly difficult for the sector, we hope that the extension of the furlough scheme will provide essential support to businesses to enable them to get through the coming weeks and months.

"Previously, the furlough scheme protected sector jobs and significantly reduced the number of redundancies. We are hopeful that the extension will see that trend continue and businesses will be further supported by the financial incentive to bring staff back from furlough that will come into effect in January.

"When it comes to navigating this period, it's vital that the whole sector is kept informed and given enough warning about what will happen when the lockdown is scheduled to end. Effective planning will be key to how operators emerge and best prepare for success as they come out of lockdown."

Photo: Shutterstock

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