Pandemic cost hospitality £200m a day in 2020

By Lisa Riley

Published: 28 January, 2021

Turnover for the hospitality sector dropped to less than half of 2019 levels in 2020, slipping by almost £72bn, which translates to nearly £200m a day, according to the latest edition of the UK Hospitality (UKH) and CGA Quarterly Tracker.

Released today, the research reveals a 54% drop in sales in 2020 for the industry, with sales collapsing to £61.7bn in 2020 from £133.5bn in 2019.

Strict local and national restrictions caused a particularly damaging drop in trade in the final quarter of the year – from October to December sales were worth just £14.3bn, down by £18.7bn or 57% on the last quarter of 2019, according to the Tracker.

The research was the “clearest evidence yet” of the shattering impact of the Covid-19 pandemic on the country’s hospitality industry, said Phil Tate, group CEO of CGA.

“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."

However, he added, with a vaccine rollout underway there was at least “some light at the end of the tunnel".

“Hospitality 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,” he said.

Echoing this, Kate Nicholls, CEO of UKH, 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.”

Last week, Nicholls pointed to how new GDP figures highlighted the importance of hospitality on the UK’s economy and made the case for the sector to be “at the heart of reopening plans”.