November GDP estimates, which were released yesterday (Thursday 16 January) by the ONS, recorded food and beverage as the highest total performing sector of the economy throughout the entirety of November.
Accommodation activity was also noted as the third highest performing consumer service.
Maximising growth potential
UKHospitality (UKH) has urged the Government to maximise the economic growth potential of hospitality as an industry, but also warned the £3.4bn set to be hitting the sector in April may threaten businesses’ ability to invest and grow, therefore having a negative impact on hospitality operators throughout the UK.
UKH chief executive Kate Nicholls said: “Hospitality has been the engine behind economic growth in November. This clearly demonstrates the potential the sector has to help drive recovery and prosperity nationwide.
Nicholls explained she felt it a ‘timely reminder’ for the Government around why it is worth investing significantly within the hospitality sector and support businesses in order to aid them delivering their growth agendas.
The trade body warned the £3.4bn costs levelled on the sector in April will have the opposite effect. It is already forcing businesses to abandon investment plans, freeze recruitment, cut hours and increase prices.
UKH also previously addressed the worrying level of vacancies within the hospitality industry, as data from the Office of National Statistics previously revealed more than 95,000 vacancies were recorded in the hospitality sector in October 2024.
Urged to rethink
Nicholls said: “Vacancies in hospitality remain stubbornly high. The data clearly demonstrates the need for the Government to incentivise sectors like hospitality to create jobs and support employment.”
Addressing staffing costs and other harmful impacts to the sector, Nicholls added:
“The rumoured increase to employer national insurance contributions would do the opposite – a tax on jobs.
“An increase would partially hammer sectors like hospitality, where staffing costs are the biggest business expense.”
A pause will allow proper consultation with businesses
Kate Nicholls
Further speaking on the impending rise in employer National Insurance contributions, she continued: “We are urging the Chancellor to think again and to delay the changes to employer National Insurance Contributions.
“A pause will allow proper consultation with businesses and, crucially, enable businesses to continue on a path to growth.”
