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Unemployment figures show accommodation and foodservice hit hardest

10 November 2020 by
Unemployment figures show accommodation and foodservice hit hardest

The release of figures by the Office for National Statistics (ONS) highlight the scale of the crisis being faced by hospitality businesses and emphasise the need for additional support, according to UKHospitality.

The data estimated the UK unemployment rate at 4.8%, with the largest increase in unemployment for those who were previously employed in accommodation and foodservice up 56,000 on the year to 161,000. The sector also saw the highest redundancy rate.

Young people have been particularly hard hit, with the employment level for those aged 16 to 24 dropping by 174,000 to a record low of 3.52 million.

The number of people aged 16 to 69 who moved jobs between April and June 2020 and July and September 2020 because of redundancy or dismissal was 106,000, the highest level since records began in 2001. This age group also saw the highest redundancy rate.

UKHospitality chief executive Kate Nicholls said: "The figures released by the ONS today underline the dreadful hit that hospitality has taken during this crisis and reinforces the urgent need for targeted support.

"Our sector has seen the highest fall in jobs of any. We are entering another period that is likely to be incredibly difficult for us. Businesses are in lockdown once again and when they do reopen, it will be back into a severely restrictive environment.

"Extension of the furlough scheme will provide some protection but scrapping the Job Retention Bonus Scheme is a major blow at a time when things could not be tighter – dramatically impacting on cashflow and potentially making businesses technically insolvent.

"Furlough will still mean that employers must pick up the cost of national insurance contributions, while receiving no revenue. The majority of businesses are operating at a loss, with little to no financial reserves and the prospect of a bleak winter ahead.

"Government support should recognise that hospitality is being asked to operate under the toughest restrictions of any sector and being given the highest mountain to climb in order to survive – we need a new approach from 3 December."

Mayor of London Sadiq Khan said: "Businesses in London's retail, hospitality and cultural sectors still require more support until an operational vaccine is widely available, and we see a return to significant levels of international tourism. The government must ensure that all of London's venues at risk of closure get the grants they need to cover their rent and bills, and stay afloat. As I've been saying since the start of this crisis, with the right support in place further mass unemployment is not inevitable."

Photo: Shutterstock

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