Are we at the pub jobs cliff edge?

UKHospitality (UKH) warned at least 900,000 hospitality workers faced losing their jobs last month (September) without further support from the Government.

According to the Office of National Statistics, the total number of people without work soared by 62,000 in the three months to July and while the Coronavirus Job Retention Scheme (CJRS, known as furlough) was praised by trade bodies. Yet, it should be noted almost 100,000 hospitality jobs were also lost in this period.

With the end of furlough nigh (due to close at the end of October), the 10pm curfew looking set to stay for the near future alongside the Covid-secure guidelines operators are having to adhere to, it appears the sector could face further job losses.

Labour expert Chartered Institute of Personnel and Development senior labour market adviser Gerwyn Davies told The Morning Advertiser​: “I wouldn't want to put a figure on it but it's clear there will be a spike in redundancies, which will be heavily concentrated in sectors that are more reliant on the CJRS and others and hospitality is one of those.

“One of the unfortunate aspects of this is it will fall disproportionately hard on young people and low paid workers, who make up vast swathes of that sector.”

He suggested the Government put together a similar, sector-specific initiative for the trade.

“It does suggest the Government could look at some form of scheme albeit maybe a less generous one, specifically for those sectors that are not operating at full capacity and clearly the pub trade is one of those,” Davies added.

Chancellor of the Exchequer Rishi Sunak did announce a Job Support Scheme (JSS) in place of the furlough scheme as part of his Winter Economy Plan.

However, multiple operator North Bar/North Brewing Co has made six redundancies out of its 100 staff and co-founder Christian Townsley slammed the new initiative.

“JSS is a shambles. It costs employers more per hour for staff and taking less per hour in sale and revenue, it’s totally non-nonsensical.”

Trading restrictions

The latest firm to announce a slew of redundancies was Greene King preparing to close 79 venues and cut hundreds of jobs due a fall in trade.

The closures equate to about 2.5% of Greene King’s 3,100-strong estate and the 800 potential job losses is around 2.1% of its 38,000 employees.

The Morning Advertiser ​understands while 800 of Greene King's members are impacted by the closures, the company is looking to redeploy them in other parts of the business.

A spokesperson for Greene King said: “The continued tightening of the trading restrictions for pubs, which may last another six months, along with the changes to Government support was always going to make it a challenge to reopen some of our pubs.

"Therefore, we have made the difficult decision to not reopen 79 of our pubs and restaurants. About one-third will be closed permanently and we hope to be able to reopen the others in the future. We are working hard with our teams to try and find them a role in another of our pubs wherever possible.

“We urgently need the Government to step in and provide tailored support to help the sector get through to the spring and prevent further pub closures and job losses.”

Furthermore, Lancashire-based brewer and pub operator Daniel Thwaites took the 'unwelcome decision' to initiate a programme of redundancies in light of uncertainty around winter trading conditions.

The operator of about 250 venues said this would help keep its cost base in line with trading forecasts for the wider sector over the coming months and “greatly shortened” visibility on forward bookings.

Fellow multiple operator Whitbread, the operator behind brands such as Beefeater, Brewers Fayre and Premier Inn, announced as many as 6,000 members of staff could face redundancy following a collapse in sales amid the coronavirus crisis.

Last month (September) The Morning Advertiser reported the business currently employed in the region of 35,000 workers across the UK meaning more than one-in-six would lose their jobs. 

According to reports in The Guardian​, Whitbread was also close to cutting 15% to 20% of jobs at its head office, a further 150 positions.

At risk

The firm, which said it had begun consultations with staff and hoped the majority of cuts could be made voluntarily, revealed ales during the first half of its financial year to 27 August slipped by nearly 80% due to the enforced closure of most sites. 

In the same month, it was revealed late-night operator The Deltic Group was set to slash 402 jobs in a redundancy consultation across its estate after a prolonged period of closure with no reopening date announced yet, reports stated.

This means Deltic, which has 53 sites nationwide including brands Pryzm and Eden, will lose 10% of its 4,000 workers.

Also in September, pub staff at JD Wetherspoon (JDW)'s airport sites were told a possible 400 to 450 roles are at risk of redundancy due to a drop in passenger numbers, it has announced.

JDW chief executive John Hutson said: “The company has written to 1,000 people employed in its pubs at six airports (Gatwick, Heathrow, Stansted, Birmingham Edinburgh and Glasgow) to inform them a possible 400 to 450 positions are at risk of redundancy.

“The decision is mainly a result of a downturn in trade in these pubs, linked with the large reduction in passenger numbers using the airports.

“We should emphasise no firm decisions have been made at this stage. The company will listen to suggestions from staff to help avoid or reduce the number of compulsory redundancies, which are required.

“JDW is proposing to collectively consult with employees through an employment representative committee, which will be established for this purpose.”

This came just weeks after the pub giant informed head office staff a possible 110 to 130 roles were at risk and claimed at that time, no staff in its sites would be impacted.

In an announcement on 6 August, JDW emphasised that redundancies would be confined to its head office operations and that no staff working in its 873 pubs would be affected. 

With it looking less likely the Government will U-turn on its 10pm curfew rule and no further financial aid for the sector having been announced, the trade still faces months of uncertainty with more job losses potentially on the horizon.