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Long Read: Night-time economy is being left behind, say operators

Published:  25 February, 2021

The whole of the on-trade has been gravely impacted by the closures associated with Covid. However, the night-time economy, which looks set to fully reopen in July – two months after other indoor hospitality venues – continues to suffer the worst of the impact, with operators calling for more clarity on their future.

According to the latest announcement, the night-time economy could re-open from 17 May at the earliest, with a ‘rule of six’ in place. The 21 June however is the date we can expect to see the end of social distancing, which is needed for a full re-opening of late night openings of venues like night clubs.

While a roadmap for reopening has been met with some optimism, the late night operators, which continue to bear the brunt of the worse impacts of the restrictions, including curfews, continue to feel left behind.

One such venue is The Lexington, one of London’s great remaining independent music outlets. Having received only 40% of the Arts Council funding it applied for, the business recently turned to crowd-sourcing platform Crowdfunder for a second time. It successfully raised funds this way in the summer of 2020. However, owner Stacey Thomas doesn’t believe they’ll hit their £180k target for their second round of funding, which could leave them facing permanent closure.

“This [crowdfunding round] has been a lot more muted because a lot of people have lost their jobs, it’s winter, it’s grim, people can’t see the light at the end of the tunnel. The Crowdfunder is going to be shutting in four weeks. There’s going to have to be a hell of a lot happen to get to that level,” Thomas said.

The recently released All Party Parliamentary Group (APPG) report, which highlighted the impact Covid on UK nightlife, makes for damning reading. The cross party group of more than 40 MPs last week told the Chancellor and Prime Minister to act now, or witness the extinction of UK nightlife which is worth £66bn per year to the UK economy, making it the UK’s fifth biggest industry (The Night Time Industries Association figures).

The APPG report also found that businesses in the night-time economy have on average made 37% of their total workforce redundant. In the second half of 2020, businesses in the nighttime economy traded at an average of 28% of their annualised pre-Covid turnover. Without serious help, businesses won’t survive.

Venues like The Lexington are crucial not just to the fabric of our nightlife, but in nurturing talent. Music is one of the UK’s biggest exports. Venue closures up and down the country are not only throttling new musical talent coming through, they are also strangling employment opportunities for young people starting their careers in hospitality where they develop a passion for drinks and learn how to manage a bar. The APPG report found that 85% of those working in the sector are considering leaving the industry, which could mean an entire generation lost to the workforce.

Morale is low, debts are high, and operating costs don’t come close to being met with social distancing in place. “We wouldn’t make enough with 30 people in the building to pay the electricity bill, let alone everything else that goes along with it,” Thomas said. “So we stayed shut [in the summer]. We are not going to re-open with those kind of measures because we’ll haemorrhage money.”

After the first lockdown in March 2020, bars were able to re-open at reduced capacity in June. The 10pm curfew was introduced later in September, thus severely reducing revenue for late night operators.

Though the end of lockdown is in sight, with a roadmap outlined by the Prime Minister on Monday (22 February), late night venues still face uncertain futures. Operators also feel like they have been left behind when it comes to government restrictions, with delayed clarity making it “totally impossible to plan”.

Alex Kratena, co-founder of Tayer + Elementary, added: “The announcement is disappointing as it is once again not driven by data. And since it puts the industry on the cliff edge once again there needs to be a support measures from Rishi Sunak in the form of extending business rates, but also finally sorting the moratorium and dealing with rent debt, VAT relief for both food and drink, as well as extension of furlough.

“There also needs to be a public enquiry about how the government handled the pandemic. Not on a single occasion were sectors such as ours given sufficient notice on crucial dates.”

Kratena was a vocal critic of the 10pm curfew. Did things play out as badly as he feared?

“The curfew had an absolutely devastating effect on bars. It was a desperate attempt [by] politicians to do something highly visible and whilst totally pointless, it gave public impression that the government was doing something. It is also worth noting that the 10pm curfew undermined pretty much every licensing objective and created additional problems for both operators and public services,” he said.

More support is needed if the late night industries are to survive the gradual re-opening now coming into effect. Though the curfew is due to be scrapped in the coming months, late night venues continue to be left at the very tail end of restriction easing.

Bills, business rates, and rent continue to be unmanageable for many, creating looming amounts of debt that will make much of the industry bankrupt unless government steps in, and makes sure the music, as well as the bars and those young, enthusiastic workers, don’t disappear when the sun goes down.