Budget Threatens Optimism for Hospitality Recovery

Budget Threatens Optimism for Hospitality Recovery

Britain’s Beer‑Buzzing Hospitality Scene Keeps Growing…

It turns out the pubs, restaurants, and cafés across the UK are not stopping at the doorways. The Hospitality Market Monitor, powered by CGA by NIQ and AlixPartners, reports that the number of licensed premises climbed 0.7 % between July and September last year – that’s 661 new bars, pubs, or eateries, or roughly a new spot every day + ‑ one.

Two Quarters in a Row, and the Numbers Aren’t Falling!

Before this, the industry was barely breathing in the second quarter – a slight uptick of 0.5 %, the first positive swing since around mid‑2022. Now the total sits at a tidy 99,868 venues. Pretty much the same as a year ago – the economy’s been holding its ground.

Budget Blues: Extra Costs Cloud the Outlook

However, a bitter twist: the Autumn Budget has tossed an extra burden onto hospitality. National Insurance contributions for employers have risen and business‑rates relief has been tightened. Industry leaders are worried this could halt the current streak of new openings and trigger more closures downstream.

Impact on the Independent Cheers‑Scene

The independent sector, battered by COVID and a sweltering inflation roller‑coaster, is 15.9 % smaller than it was in March 2020. After four straight quarters of contraction, it’s seen a modest 0.7 % bump in three months, yet the new cost pressures could stall the revival of small businesses and start‑ups.

Local Pubs: A Tiny Downturn, But Slowly Rebounding
  • Community pubs have slipped 12 % from pre‑COVID numbers, but grew 0.4 % from June to September.
  • The high‑street pub segment is up 3.8 % from just a few months earlier.
Regional Highlights

London and Scotland are the hot‑spots, reporting higher-than‑average growth rates, while other regions provide mixed signals.

Quotes from the Business Gene‑Bank

“Two successive quarters of growth signal that the hospitality sector is still fighting through the chaos,” Karl Chessell, CGA by NIQ EMEA Director, tells us. “We’re smaller than pre‑COVID, but people are still opening rather than pulling back. The future looks cautiously optimistic, until the new labour and rate costs threaten to stall the momentum.”

Graeme Smith, AlixPartners MD, adds: “If there were no new budget headaches on the horizon, these findings would see us doing a little happy dance. Instead, we need to keep an eye on the drips that may slow our ascent. The rise in the National Living Wage might pull customers in, but we’ll need to capitalize on that before it fades.”

Bottom Line

Britain’s hospitality scene is still showing belly‑laughing growth, but the recent budget blows a dampener on the enthusiasm. Will the industry keep its chin up or buckle under the new tax and cost strains? We’ll monitor the numbers just as we watch the next wave of new pubs, restaurants, and trendy bars pop up on the map.