LONDON – The U.K.'s pubs and restaurants could see well over 500,000 job losses by the end of 2020 as a result of new coronavirus restrictions, including the requirement they shut their doors at 10 p.m., the head of the hospitality sector's main lobby group warned Tuesday.
Kate Nicholls, chief executive of UKHospitality, told lawmakers that the combination of the curfew, local lockdown restrictions and a downturn in customer confidence has hit pubs and restaurants in recent weeks.
She urged the government to provide more support to companies hit particularly hard by the recent uptick in virus cases and the ensuing restrictions.
She said research conducted by the group a couple of weeks ago had pointed to the loss of around 560,000 jobs by the end of the year, but a big drop in business since then will likely push that number up.
“We are doing that data again but we anticipate it will be far higher due to local restrictions, the national constraints on events, working from home and the curfew,” she said.
As elsewhere in Europe, curbs on everyday life have been reimposed in the U.K. following a spike in new coronavirus infections. On top of national restrictions, there are many local measures, largely relating to the number of people allowed to gather.
Since the 10 p.m. curfew was announced last month, many within the sector have argued that it's counterproductive as people just leave to congregate at someone's home, where social distancing guidelines are likely to be observed less carefully.
Many lawmakers and politicians, including the mayor of Greater Manchester, Andy Burnham, have urged a review, though that is considered unlikely.
Hundreds of thousands of jobs in hospitality have been protected during the pandemic as a result of the Job Retention Scheme, whereby the government has been paying the bulk of their wages. The programme will be replaced by the less generous Jobs Support Scheme, which will see the government pay up to 22% of wages for workers who come back from Nov. 1. Treasury chief Rishi Sunak has said the government cannot support every job in the economy forever.
Many workers on furlough returned to their jobs when the sector reopened in early July after months of lockdown. But Nicholls said around 900,000 hospitality workers remain on furlough and urged the government to do more to ensure that most of them remain in their jobs through winter.
“There is a very real danger that we will lose large chunks of the economy," she said. “In hospitality we will have insolvent businesses, businesses going into administration and therefore that engine of growth for re-employing people will be lost for good.”
The U.K. has been spared the sharp rise in unemployment seen in many other countries, largely because of the furlough scheme. Economists, including those at the Bank of England, are forecasting that the unemployment rate will double this winter to around 8%. That would push unemployment towards the 3 million mark, a level the U.K. has not seen since the early 1990s.
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