Hospitality Sector Faces £3.4bn Cost Surge, Urges Government Action

UK hospitality businesses are facing a £3.4 billion surge in annual costs from April, prompting urgent calls for government support. According to UKHospitality, the sector will be hit with an additional £1.9bn in wage costs, £1bn in national insurance contributions, and £500m in business rates due to reduced relief.

The cost of employing a full-time staff member over 21 has risen by over £2,500 a year, while employment costs for younger staff have jumped up to 18%. As a result, 70% of businesses plan to reduce staff, a third expect to cut trading hours, and 15% may close sites.

UKHospitality chief executive Kate Nicholls warned that the cost increases are already halting investment and job creation. She urged the government to deliver a robust support plan, including maximum business rates relief in the upcoming autumn reform.

“With disjointed tax and welfare policies, growth and job creation are becoming harder,” Nicholls said. “The government must back hospitality to help Britain thrive.”