UK Hospitality Sector Sheds 170,000 Jobs Since October 2024 Amid Tax Hikes

The UK hospitality sector has experienced a significant loss of jobs over the past 13 months, according to new estimates from the trade association UKHospitality. The group reports that approximately 170,000 jobs have disappeared since the autumn Budget delivered in October 2024. The data, based on figures from the Office for National Statistics, also shows that 64,000 of these jobs were lost in just the last two months.

UKHospitality attributes much of this decline to policy changes introduced in Chancellor Rachel Reeves’ first Budget. One of the most impactful measures was an increase in employer National Insurance contributions by 1.2 percentage points, which took effect in April this year. The trade body says this change has led to a sharp reduction in part-time and flexible work opportunities within the industry.

The hospitality sector appears to be bearing a disproportionate share of job losses across the UK economy. UKHospitality claims that more than half of all job losses since last October have come from hospitality businesses. The effects extend beyond employment, with many companies reducing operating hours, cancelling planned investments, raising prices for consumers, or closing their doors permanently.

Kate Nicholls, chair of UKHospitality, described the situation as “a shocking indictment of the damage caused by last year’s Budget.” She emphasized that if the government wants to boost employment and revitalize high streets, it must support hospitality businesses rather than burden them with higher taxes. Nicholls called for urgent action ahead of the next Budget, scheduled for November 26. The group is advocating for lower business rates, fixed National Insurance contributions, and a reduction in VAT for hospitality businesses.

The scale of closures across the industry has been stark. A report from the Night Time Industries Association earlier this year found that one in four late-night venues has closed since 2020. Data from NIQ indicates a net decline of 374 licensed premises in just the first half of this year—an average of two closures every day.

Several well-known bar chains have struggled under these pressures. Simmons, a late-night cocktail chain, faced collapse due to cashflow problems but was rescued from administration by its founder in August through an £6 million deal. This rescue involved closing four locations and cutting 30 jobs. Other operators are also facing uncertainty; last month it was reported that the parent company behind Revolution and Revolución de Cuba is considering options for survival, including a possible sale. BrewDog announced it would close 10 bars across the UK this year.

UKHospitality had previously estimated that 111,000 jobs would be lost by the time of the next Budget. The latest figures show that job losses have far exceeded those projections. The organization continues to warn that without immediate government intervention, further losses are likely as businesses struggle with rising costs and reduced consumer spending.

Industry leaders say that unless there is relief on taxes and other overheads, more closures and job cuts are inevitable. They argue that targeted support could help stabilize employment and allow hospitality businesses to recover and grow after a challenging period marked by inflationary pressures and changing consumer habits.