PM urged to act as hospitality loses 69,000 jobs

The hospitality industry has warned the prime minister it risks being “taxed out” of the jobs market, after losing 69,000 jobs since October 2024.

Job losses in the sector have been three times higher than across the wider economy since the Budget, according to UKHospitality, which has urged the government to reverse changes it says have hurt employment.

In a letter to the prime minister, UKH said the 2024 Budget directly undermined the sector’s ability to create jobs. Between October 2024 and May 2025, it said, the industry shed 69,000 roles, compared with creating 18,000 jobs during the same period the previous year.

In light of this, the trade body has called for national insurance contributions (NICs) to be reformed by extending existing exemptions to cover both young people and those moving from welfare to work. 

It also urged ministers to lower business rates by granting the maximum discount of 20p for hospitality businesses, and to cut value added tax (VAT) in line with other European countries.

Kate Nicholls, chair of UKHospitality, said: “In the years following the financial crisis we created one in five net new jobs and today employ 3.5 million people. The government needs sectors like hospitality to create jobs and meet their ambition to get more people back into work.

“We have a proven track record of being able to deliver those jobs in every part of the country and for people from all backgrounds.”

She added: “The NICs change was socially regressive and had a disproportionate effect on entry level jobs. Without a change of tack from the government we could be looking at over 150,000 fewer workers in hospitality, when we should be bringing people into the jobs market. The economy needs jobs. Hospitality creates them. But we are being taxed out.”