Impact of Covid-19 on Hospitality and Tourism in Buckinghamshire
The hospitality and tourism sector in Buckinghamshire has faced significant challenges due to the Covid-19 pandemic, with a notable decline in economic output and employment. The sector, comprising around 2,000 businesses and 18,000 employees, has experienced a slower growth rate compared to the national average. The financial impact has been severe, with ongoing fixed costs, accumulating debt, and lower revenues creating major concerns. Lockdown measures have led to a large percentage of businesses pausing trading and employees being furloughed.
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v v Impact of Covid-19 on hospitality and tourism Caroline Perkins, Buckinghamshire LEP February 2021
The hospitality and tourism sector in Bucks v Circa 2,000 businesses 18,000 employees One in 12 jobs in Buckinghamshire in hospitality / tourism sector Source: UK Business Count 2020 and BRES 2019 ONS *Excludes self-employed
The hospitality and tourism sector in Bucks Number of pubs 450 Sector has been growing, but at a slower rate the nationally Business growth 10 years to 2020 (15% Bucks v 25% nationally) Employment growth 5 years to 2019 (7% Bucks v 11% nationally) 16% decline in number of pubs in Bucks since 2010, 12% nationally 400 350 300 250 200 150 100 50 0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Source: UK Business Count 2020 and BRES 2019 - ONS
v Financial impact of Covid-19 the national picture One of the hardest hit sectors by the pandemic. Trading restrictions during 2020/21 significantly impacted turnover. Sector has seen greatest decline in economic output of all sectors Economic output recovered over the summer but was still below pre-pandemic levels. Output declined again from September as Covid cases rose and new restrictions imposed. Ongoing fixed costs and accumulating debt alongside persistent lower revenues and low cash reserves are a major concern for the sector. High take-up of business support schemes
Economic output 2020 the national picture v Change in output by sector Q4 2019 to Q3 2020 -30.0 -25.0 -20.0 -15.0 -10.0 -5.0 0.0 5.0 Manufacturing -7.1 Construction -6.9 Wholesale and retail 0.4 Transport, storage and -11.6 Accommodation and food services -28.2 Financial and insurance activities -2.5 Real estate -1.6 Professional, scientific administration -14.2 Public administration and defence 1.7 Education -14.2 Health & social work -16.4 Source: ONS, December 2020 Other services -21.9
v Current state of affairs lockdown 3 64% hospitality businesses paused trading (26% all industries) 34% hospitality businesses trading (71% all industries)* 700 firms / 900 sites 40% arts, entertainment & recreation employees furloughed 47% hospitality employees furloughed (13% all industries)** 1,800 employees 8,000 employees *ONS Business Impact of Coronavirus Survey Wave 22 (data for the period 11-24th Jan 2021) ** HMRC, 28 January 2021
Use of furloughing over time (UK data) v 10,000,000 1,800,000 9,000,000 1,600,000 8,000,000 1,400,000 7,000,000 1,200,000 6,000,000 1,000,000 5,000,000 800,000 4,000,000 600,000 3,000,000 All industries Accommodation and food services 400,000 2,000,000 200,000 1,000,000 0 0 Monday, March 23, 2020 Thursday, April 23, 2020 Saturday, May 23, 2020 Tuesday, June 23, 2020 Thursday, July 23, 2020 Sunday, August 23, 2020 Wednesday, September 23, 2020 Friday, October 23, 2020 Monday, November 23, 2020 Wednesday, December 23, 2020
Unemployment increase v numbers furloughed (UK) v 700,000 Hospitality 600,000 500,000 Numbers furloughed 400,000 Wholesale & retail 300,000 Professional, scientific & technical Admin & support services 200,000 Manufacturing Human health & social work activities Construction Other services Transport & storage 100,000 Information & communication Education Public admin & defence 0 - 10,000 20,000 30,000 40,000 50,000 60,000 70,000 Unemployment increase Sources: Labour Force Survey, ONS and HMRC
Reduced demand: occupations with fewer job postings in Bucks in Q4 2020 than Q4 2019 v -120 -100 -80 -60 -40 -20 0 Chef Credit Analyst / Authoriser Computer Support Specialist Office / Administrative Assistant Operations Manager Procurement Manager Human Resources / Labour Relations Specialist Sales Representative Automotive Service Technician / Mechanic Account Manager / Representative Web Developer Validation Engineer Marketing Representative Nanny / Babysitter Mechanical Engineer Food Service Team Member Graphic Designer / Desktop Publisher Waiter / Waitress Sales Manager Systems Analyst Customer Service Representative Veterinarian Receptionist Maid / Housekeeping Staff Primary and Secondary School Headteacher Market Research Analyst Computer Programmer Restaurant / Food Service Manager Hospitality (chefs, food service, waiting staff, housekeeping) HR / recruitment Computer (IT support, programmers, analysts) Office admin Sales and marketing Source: Labour Insight
v Business Adaption Responding to ever changing rules (time and costs associated) Policing the rules Pivoting (take-away, deliveries, virtual experiences, retail, new markets)
v Impact of Brexit Covid-19 has led to an exodus of immigrants from the UK, particularly from London Likely linked to loss of jobs in hospitality sector Those from EU without settled status will find it more difficult to return Staffing implications for sector when demand returns? Phasing out of use of EU ID cards as travel documents from October 2021 Reduce inbound tourism from Europe?
v Looking ahead Hospitality and tourism will open up again Late spring? Summer? Early autumn? People will go back to restaurants and pubs, live events will re-start, people will take holidays and day trips People may never return to offices in same numbers though which has long-term implications of some hospitality businesses reliant on office worker footfall Capacity issues when re-opening due to continued need to socially distance Consumers more confident to go to outdoor venues than indoor ones? Inbound tourism likely to take longer to bounce-back. VisitBritain forecast that.. UK inbound tourism visits in 2021 will be 29% of 2019 levels spend by inbound tourists in 2021 will be 23% of 2019 levels Inbound tourism highly dependent on success of different country s vaccine programmes / nature of new Covid variants
v Looking ahead Will there be a Great Splurge? (Credit: Peter Backman) As happened post the Great Recession Pent up demand Those not impacted by job insecurity, increased savings Young people Enhanced sense of community Opportunity for revival of pubs / local events
v v Any questions? More local charts and data available here.. https://www.buckstvlep.co.uk/useful-information/buckinghamshire-economy/ @ @Caroline_BLEP
