Half of pubs forced to reduce trading hours due to staff shortage

Despite rising costs and the need to take advantage of revenue opportunities, staff shortages in the hospitality sector are seeing half of pubs forced to reduce their trading hours.

A survey of British Institute of Innkeeping (BII) members found that a quarter were having to close their doors for one or more of their usual trading days, with three-quarters reporting vacancies in their businesses they were struggling to fill. Of these, over half had more than 10% of their roles vacant and one in eight had more than 20% vacancies.

The survey revealed that over 75% of members were down on the revenues they saw in 2019, with 84% of those being down by more than 10%. 28% were down by more than 30% against 2019.

In addition, 86% reported that their profits were down against the same period in 2019 and almost half of those were seeing profits down by more than 30%.

Members reported their profits were being eaten away by cost inflation across the board, with 66% saying their costs had increased more than 10%, 43% saying their costs had increased by more than 20%, and one in 10 experiencing inflation of over 40% in the last six months.

30% of respondents said they had no cash reserves in their business, with a further 50% only having between one to three months’ worth left.

70% had debts in their business, with over a third of those carrying debts of up to £30,000, 40% having debts of up to £50,000 and a quarter of pubs had debts of between £50,000 and over £100,000.

Nearly 90% were not seeking any additional finance and of those who were, two-thirds had been unsuccessful in securing that finance through any route. One in four had used their own savings to invest but only 5% had been successful in securing finance through their existing bank and only 16% able to access funds through a new or additional bank.

15% said their business was no longer viable, and they would be leaving or selling their business shortly.

The BII said its members had identified four key areas that would support their businesses: a reduction in VAT, an energy price rise cap, full cancellation of business rates for 2023/24, and a duty cut on draught beer and cider.

Steve Alton, chief executive of the BII, said: “Pubs have weathered the storm of Covid, by repurposing and diversifying their offer, creating safe, environments in every community, welcoming customers and teams from all walks of life and caring for those communities in the darkest of times.

“Without support from government across the four key areas our members have identified, we will undo all of the good they do in bringing people together. Without support we will lose the opportunity for growth and regeneration, we will lose pubs from the heart of their communities, and we will lose something very special in our nations’ unique heritage and culture.

“They now need, and deserve, the support that can enable them to survive and thrive once more.”

Photo: Shutterstock / Eugenevortep