Coronavirus

17% of hospitality firms at ‘severe risk’ of insolvency

Some 17% of accommodation and food service companies are at a “severe risk” of insolvency, according to the latest Business Impact of Coronavirus (COVID-19) Survey (BICS) from the Office of National Statistics (ONS).

The latest data covering the period 21 September to 4 October, shows that across all industries, 5% had a severe risk of insolvency; 13% had a moderate risk of insolvency and 46% had a ‘low risk’ of insolvency and 25% had ‘no risk’ of insolvency.

It also comes as the ONS revealed that 27% of businesses surveyed said that they had less than three months worth of cash reserves.

Across all industries 4% said they had no cash reserves; 23% had less than three months’ cash reserves; 16% had between four to six months’ cash reserves and 35% had more than six months’ cash reserves.

The accommodation and food service activities industry had the highest percentage of businesses that had no cash reserves, at 7%.

The ONS also revealed that 9% of the UK workforce were still on partial or full-time furlough, with the accommodation and food service activities industry having the highest proportions of their workforce on partial or full furlough, at 28% and 24% respectively.

The survey also found that the proportion of adults who travelled to work decreased by 5 percentage points, to 60%. Conversely, the proportion who worked from home increased to 25%, the highest since the beginning of August.

Meanwhile, data from Springboard showed that overall footfall decreased in the week ending 18 October to below 70% of its level in the same period of 2019. It dropped across high streets, shopping centres and retail parks, with the largest decreases in the East of England and Northern Ireland.

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