A recent Night Time Industries Association (NTIA) survey has revealed that businesses in the nightlife sector have witnessed a 26% rise in their total operating costs in the last year alone.
Some 198 NTIA members across England, Wales and Scotland responded to the survey, which reported an average increase of 18% in food and drink costs, as well as an 18% rise in workforce costs.
There was also an average surge of 29% in utility costs and an average increase of 31% in insurance costs.
April is also set to potentially pour fuel on the fire with employers’ National Insurance contributions rising by 1.25%, the National Living Wage increasing to £9.50 ($12.87/€11.26) an hour, the end of pandemic moratorium on legal action by creditors, and further reductions in Government support.
VAT is due to return to 20% after almost two years of being cut to allow for recovery following the global pandemic.
The survey also revealed that businesses on average were operating at 68.9% of their pre-pandemic trading levels, but some 90% of respondents said they would require further support from the UK Government. The main asks were an extension of the reduced VAT rate and business rates relief, as well as further grants.
Chief executive of the NTIA, Michael Kill, said: “These statistics show just how bleak things remain for our sector. I think there is a temptation to think that, because it feels as if the pandemic restrictions are now behind us, that nightlife will just snap back to its pre-pandemic strength and everything will be fine.
“Sadly, this couldn’t be much further from the truth. We are still running into severe economic headwinds, and April threatens to be a perfect storm for the sector. I would now even at this late stage, urge the Chancellor to postpone all the tax increases – on National Insurance, VAT and business rates – to give some perfectly viable night time economy businesses a fighting chance of survival.”
Image: Antoine J. on Unsplash
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