The pandemic and ensuing lockdowns cost the hospitality sector nearly £200m a day or £8m per hour in lost sales last year, with turnover less than half of 2019 levels, according to new data from UKHospitality and CGA.
The latest edition of their quarterly tracker reveals that sales across restaurants, bars, pubs and hotels plummeted 54% in 2020, falling from £133.5bn in 2019 to £61.7bn in 2020.
Strict lockdowns and restrictions caused a “particularly damaging” drop in trade in the final quarter of the year. Sales from October to December 2020 fell to £14.3bn, down by 57% or £18.7bn against the same period in 2019.
UKH and CGA have warned that the “stark” figures highlight hospitality’s ongoing need for specific financial support from the government in order to survive the crisis and “play its part in economic recovery”.
It comes as recent CGA research found that around 6,000 licensed premises in Britain closed permanently in 2020. With ongoing restrictions likely to remain in place for months, it said that aid is “urgently needed” to prevent thousands more business failures.
Kate Nicholls, CEO of UKHospitality, said: “These figures are simply devastating; hospitality was hit first, hit hardest and continues to suffer because of pandemic restrictions brought in.
“And sitting behind this massive loss of revenue is the dreadful, real impact on people’s lives and livelihoods across all parts of the sector and supply chain. It is also yet another stark reminder of the importance of having an exit strategy from the current lockdown and providing ongoing support for sector businesses.”
She added: “Hospitality can and will bounce back and it’s in the interests of the Government to support a sector that, in normal times, contributes many billions of pounds in tax to the Treasury and employs over three million people.
“We need the Chancellor to step up again in his forthcoming Budget to deliver a bold, wide-ranging package of financial support that ensures as many businesses and jobs as possible are saved and the sector returns to growth. An extension of the VAT cut and business rates holiday must be top of the menu.”
Phil Tate, group chief executive of CGA, said: “This is the clearest evidence yet of the shattering impact of the COVID-19 pandemic on the country’s hospitality industry.
“With every week of restrictions, the sector loses more than a billion pounds of sales, hundreds of businesses and thousands of jobs. Widespread closures over December, the busiest time of year for so many restaurants, pubs and bars, were a devastating final blow in a year of unprecedented challenges.”
He added: “With a vaccine rollout underway there is at least some light at the end of the tunnel, and this sector is well placed to help recharge the UK economy as 2021 goes on. But it will only be able to do so if it gets the extensive support that is now desperately needed to sustain it over the next few months.”