GDP figures shows how hospitality sector is driving the UK’s economic recovery, but at a £100 billion cost

Wellington Pier UK Hospitality data economic recovery
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Leading trade body UKHospitality has been consistent in its view that the industry has the power to drive a broader economic recovery. While the figures confirm that view, the association is asking for government assistance to sustain the recovery.


Data produced by UKHospitality as part of its Quarterly Tracker, produced by CGA, shows the sector was responsible for 40 percent of the UK’s total economic growth from Q1 to Q2 2021.

Following ONS confirmation that the UK economy grew by 4.8 percent in Q2 2021, UKHospitality Chief Executive Kate Nicholls said: “These figures not only show the importance of the hospitality sector to the UK economy, even in the severely restricted and beleaguered state it was in during the second quarter of this year, but also demonstrate its real potential to power a wider economic recovery now trading restrictions have finally been eased after almost 18 months.

“However, this was not a period characterised by booming sales and plain sailing for the sector, but many weeks where businesses were still operating under strict restrictions and experienced a multitude of challenges brought about by the pandemic.

“What should be remembered is that the sector collectively lost over £100bn in sales across the course of the pandemic – a truly staggering figure.

“To help safeguard the future of the sector and its recovery, we urge the Government to continue to work closely with businesses to help them navigate the challenges that we will undoubtedly face in the months ahead and to create a business landscape that will help return businesses to profitability as quickly as possible.

Measures we are calling for include the urgently needed reform of business rates and a permanently lowered rate of VAT.”


Pandemic costs hospitality sector £100 billion in sales


Recent figures from the UKHospitality Quarterly Tracker have revealed that the sector has lost £100.2bn in sales over the last 15 months, compared to pre-pandemic trading levels.

UKHospitality bar chairsThe survey found sales for the 12 months to 30 June 2021 were down £72bn from the same period in 2018/19, prompting calls for action on the multiple issues currently facing hospitality.

“These figures confirm in stark terms, the huge impacts on the hospitality sector during Covid,” said UKHospitality CEO Kate Nicholls.

“Furthermore, while we hoped to be close to normal trading from 19 July, in reality, hospitality businesses instead remain impeded by the ongoing ‘pingdemic’ crisis, the pre-existing staffing shortage and the looming shadow of vaccine passports over some of the sector.”

Noting that the sector can act as “a leading economic force in driving an economic recovery,” Nicholls added that “to do so in current conditions and with huge debt accruals, it will need further support to push it over the line and back to pre-Covid trading.”

“Extension of the business rates holiday, speedy resolution to the rent problem and retention of the lower VAT rate indefinitely are more crucial than over to safeguard jobs and businesses.”

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