Insights on Hospitality Recovery – Summary of the October Report

Diving deeper into the stats, the data indicates 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 re-opening following the first lockdown. The study also reveals:

• There have been 500,000 sector job losses since January
• There has been a 21% drop in overall staff headcount compared to October 2019
• There were approximately three leavers for every one starter throughout October
• The total staff headcount across SMEs was down by 23.3% versus October 2019
• This is compared to large scale, national operators, where the drop in staff headcount was 16.8% versus October 2019

Our data, which has been aggregated from analysis of over 700 companies across the restaurant, pub, bar and QSR sectors, reveals that a further 21,337 hospitality workers lost their job in October, representing 7.5% of the total workforce, which tracks in line with the previous three months. 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.

Similarly, the pattern for scheduled working hours during October echoed the above, as large enterprises experienced a drop of 37.1%, compared to SMEs that suffered a drop of 47.7% in hours scheduled, compared with October 2019. This could indicate that smaller businesses have been able

to change their operating hours more straightforwardly to fit around restrictions like the 10pm curfew.

Whilst entering a second lockdown is incredibly difficult for the sector, we hope that the extension of the furlough scheme, up to the end of March 2021, 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 early next year.

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