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The rail strike has had a worse-than-expected impact on the UK hospitality industry, according to the heads of bodies representing the sector.
Kate Nichols, CEO of UK Hospitality, said this led to “the perfect storm” for businesses battling the crisis of high energy prices and cost of living, adding that the next three months “will definitely see more of business failures,” he added.
She said recent rail strikes have hit the sector hard, with a wave of cancellations of Christmas parties and dinners during the week of December 12.
Industry groups have estimated that the December-January strikes have cost them £1.5bn, but say recent industrial action has caused losses of that magnitude in the past month alone. .
Speaking to BBC Radio 4’s Today programme, Nicholls said:
The RMT-led railway union has staged a series of strikes since June over wages and working conditions. With several more days of strikes scheduled for next week, RMT is expected to be in action again over his four days and the Athlef union representing the driver is planning a strike for his January 5th.
UKHospitality has tracked funds from payments and cancellations across the industry.
Nicholls said after the train strike was announced the week of December 12, “we’re seeing cancellation rates of 50% to 60% in central London and 20% to 30% in the rest of the city.” Seen the day of those strikes.’
Town and city center traffic data showed a 27% drop in sales on strike days across the UK, and a 46% drop in central London and cities. It added that this had been happening throughout the year since it was announced.
About 2,500 hospitality establishments were forced to close last quarter, but the trend is likely to continue into the new year due to the high cost of doing business, a UK hospitality boss said. “With soaring energy prices, high input cost price inflation exceeding 20% for the first time, and a cost of living crisis that hits consumer confidence, businesses are in a complete storm.
“Definitely it’s going to be a very tough first quarter for hospitality. %, losing much more profitable sales in December, which means these companies will be weaker and more vulnerable heading into January.”
She called for more support from the government on energy prices after April, when the current price cap ends.
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