By Karen Peattie

STAFF shortages in the hospitality industry are reaching “critical” levels, causing nearly half (45 per cent) of operators to cut trading hours or capacity in order to cope and costing the industry £21 billion in lost revenue.

The stark reality of the staffing issue hits home in a joint survey by UKHospitality, the British Institute of Innkeeping, and the British Beer and Pub Association which demonstrates how a shortage of workers is damaging hospitality businesses and the UK’s recovery from the pandemic.

According to the trade bodies, the crisis is causing an estimated £5bn loss in tax for the Exchequer.

In Scotland, it is estimated that there are about 40,000 vacancies across the hospitality sector, according to UKHospitality.

Earlier this week, a survey by the Scottish Tourism Alliance also shone a spotlight on the many challenges facing hospitality operators. Reflecting the views of more than 700 tourism enterprises, captured between May 17 and June 8, the survey signalled that the cost-of-living crisis, more people booking overseas holidays and a lack of competitiveness on the world stage were hitting the industry’s prospects hard.

It found that 50% of businesses have fewer bookings than normal for the June to August period when compared with the outlook when quizzed at the same time in 2019, while 40% reported a fall in spending since May.

Meanwhile, the new UK-wide survey from UKHospitality, the British Institute of Innkeeping, and the British Beer and Pub Association shows that staff shortages are forcing one in three businesses in the sector to close one or more days a week.

Recent ONS (Office for National Statistics) figures show the sector currently has a record 174,000 jobs available and is experiencing 83% more vacancies compared to March-May 2019, the most recent comparable period.

Leon Thompson, executive director of UKHospitality Scotland, said: “It is very difficult for businesses – we have estimated that there are somewhere in the region of 40,000 vacancies across hospitality in Scotland just now.

“During lockdown, when premises were closed, many hospitality staff went off to look for other jobs.

“The challenge now is to get them back and our members are doing everything they can. We are seeing wages go up for chefs, front-of-house staff and other roles such as housekeeping, and many employers are going further than that by offering flexible working – it’s something that’s seen as absolutely vital now to bring people back in.”

Mr Thompson noted that while there was future talent coming through colleges, that “natural pipeline” had been disrupted as a result of the pandemic. Brexit, he added, had also altered the labour landscape and exacerbated staff shortages which the joint survey says are highest for front of house roles, with 81% of operators looking to fill vacancies.

“The reality is that many businesses are not making any profit – they are ticking over and carrying debt from Covid which is not sustainable.

“Businesses are trying to keep costs down, reduce waste in kitchens – they are trying not to pass on their rising costs to their customers by simplifying menus and so on. Their suppliers’ costs are going up. Utility bills are up – we know of some who are paying 200% more for gas and electricity than they were this time last year.”

This week’s train strikes alone, Mr Thompson added, are estimated to see hospitality businesses lose £50m.

In a joint statement, UKHospitality, the British Institute of Innkeeping, and the British Beer and Pub Association said: “These figures clearly show the danger to the industry and financial loss to the country via taxes posed by the current staffing crisis.

"In short, the recovery of both the sector and the UK economy is being threatened by this workforce shortage.”

“Operators have been doing all they can to help solve the issue, from increasing wages, to flexible working. However, this can only help so much, and the sector must be given targeted support in order to solve the crisis.

“People are at the heart of hospitality, providing the quality customer service and personal experiences that people want. On the other side of the coin, the sector offers jobseekers a wide range of roles and fulfilling careers with great potential for progression. The sector offers opportunities to people of all levels of expertise, experience and backgrounds.

“A booming hospitality workforce will create fantastic opportunities, drive economic growth and aid regeneration in communities across the UK.”

Last month, UKHospitality launched a nationwide hospitality workforce strategy to nurture co-operation between industry stakeholders, and boost recruitment and training for a new generation of skilled hospitality staff.