The number of insolvencies recorded across the UK hospitality sector through July was up 5 percent on June, according to the latest data released by the Insolvency Service, with the figure representing the third consecutive monthly increase.
The latest official data from the Insolvency Service has revealed that the number of UK hospitality insolvencies increased 5 percent from 306 in June to 327 in July, as businesses continue to struggle with rising costs and increased tax.
For the first time in the service’s current data set the figures demonstrate a third consecutive monthly rise, with July’s total also an increase on the 323 insolvencies recorded during July last year.
The hospitality sector currently just cannot catch a break, something which was clearly recognised in the analysis of the latest statistics.
“The continued uptick in insolvencies is a worrying trend, but one we have been forecasting for several months now,” said Saxon Mosely, partner and head of leisure and hospitality at RSM UK. “The leisure and hospitality sector has had a difficult year, with higher staff costs and rising inflation continuing to bear down on businesses already struggling with low consumer confidence.”
“Many operators are now in survival mode. As a key creator of jobs, the sector is a cornerstone for the UK economy, and therefore a delicate hospitality industry presents an economic headache for the Chancellor.”
Echoing UKHospitality’s ongoing calls for a fairer and more proportionate tax system for the beleaguered sector, Moseley urged ministers to reform the current burden on businesses, or risk increasing the estimated 111,000 jobs that will be lost as a result of higher costs come November.
“Taking steps to overhaul the business rates system, as well as supporting the industry to respond to recent tax increases would help alleviate pressure on operators, keep more businesses solvent, and in turn allow them to invest in jobs for the future.”
Insolvencies rise, hospitality falls
RSM UK said… “The continued uptick in insolvencies is a worrying trend, but one we have been forecasting for several months now…
