A new survey has revealed that 44 percent of hospitality businesses fear closure in 2025, as inflation, cost pressures, and policy changes threaten the sector’s survival. But is anyone in government listening?

Nearly half of UK hospitality businesses fear they won’t survive 2025, according to a new survey highlighting the mounting pressures facing the sector.

The study, conducted by Bionic and polling 500 small-to-medium-sized enterprises, revealed that 44 percent of hospitality and tourism business owners believe their operations could cease trading within the year. Just over half were confident they would still be in business by the end of 2025.

Released ahead of the spring statement on 26 March, the survey captures the mood of a sector still grappling with the lingering effects of the pandemic and recent economic headwinds. Many responses reflected concerns over the government’s autumn Budget, which included a reduction in business rates relief, a rise in employer national insurance contributions, and an increase in the minimum wage. When asked which policy had caused them the most concern, 43 percent cited the NIC hike, while 30 percent pointed to both the minimum wage rise and the end of rates relief. 

“It’s saddening but not surprising that 44 percent of hospitality businesses think they’ll cease trading in the next 12 months,” commented Laura Court-Jones, Bionic’s small business editor. “Hospitality businesses have had it tough for years since the pandemic and with reduced business rates relief and the employers’ National Insurance hike kicking in from 6 April, these businesses are going to feel the squeeze even more.”

The broader economic environment also paints a troubling picture: 78 percent of businesses expressed worry over inflation and rising operational costs, while 74 percent flagged declining consumer spending as a major issue. To manage these financial strains, just over half of the surveyed businesses raised prices in 2024, and nearly a third reduced staffing levels. With no extra support given to the sector in the spring budget, hospitality operators won’t be any more optimistic for the months ahead – and as costs increase sharply in April, more and more will be closing their doors for good. 

“Are we heading into the collapse of our independent restaurant economy?,” concluded Court-Jones. “In 12 months, we may see very different UK high streets – we really don’t need any more Costas.”