The Hospitality Sector in Crisis: Reversing Job Losses and Rebuilding with Strategic Staffing
The UK hospitality industry is in the midst of a serious employment crisis. According to the latest figures from the Office for National Statistics (ONS), 69,000 jobs have been lost between October 2024 and May 2025 - a sharp and deeply concerning reversal of last year’s growth. This figure represents the largest non-pandemic-related contraction the industry has faced in decades.
For businesses navigating these turbulent times, Selective Personnel is here not only to supply skilled, flexible hospitality staff - but to support operators in understanding and adapting to the shifting policy landscape that directly affects recruitment, retention, and revenue.
Understanding the Drop: Why Has Hospitality Lost So Many Jobs?
UKHospitality, the industry’s leading trade body, attributes the sharp decline in employment to a steep rise in employer National Insurance Contributions (NICs) introduced as part of the government’s broader tax increase strategy in the Spring Budget 2024.
The numbers are eye-opening:
£40 billion in new taxes introduced, with around £25 billion falling directly on employers in the form of NICs.
The hospitality sector alone saw 69,000 jobs vanish in less than eight months.
In contrast, the same period the previous year saw an increase of 18,000 hospitality jobs.
This abrupt shift is not merely statistical, it reflects real-world closures, redundancies, and stalled hiring across restaurants, pubs, hotels, and catering companies.
A Sector Under Siege
At Selective Personnel, we’ve had front-row insight into how these policy changes affect our clients and candidates alike. Many of the businesses we support are being forced to:
Cut staff or freeze hiring altogether
Reduce trading hours
Close outlets temporarily or permanently
In fact, recent data shows that pubs are now closing at a rate of one per day in the UK. That’s not just a blow to the economy - it’s a direct hit to community spirit, local jobs, and cultural heritage. Over 5,600 pub jobs are projected to be lost in 2025 alone if nothing changes.
This isn’t due to lack of consumer interest. Brits still love going out for a pint, a meal, or a special celebration. The demand is there - but the cost of doing business is increasingly unsustainable.
What Is UKHospitality Calling For?
In response to this crisis, UKHospitality is calling on the government to implement three key measures:
1. Reform Employer National Insurance Contributions
Current policy exempts employers from paying NICs for under-21s. UKHospitality is urging the government to extend this exemption to include under-30s and long-term unemployed individuals. Doing so would:
Encourage employers to take on younger workers
Reduce the cost burden of onboarding new staff
Increase employment levels in a sector traditionally reliant on young talent
2. Fix Business Rates
Business rates have long been a thorn in the side of high-street hospitality. Many operators face excessive charges that don’t reflect their current turnover or real estate value. UKHospitality is advocating for modernisation of the rating system, including a permanent reduction or cap for hospitality venues.
3. Cut VAT on Hospitality Services
Reducing VAT on food, drink, and accommodation, especially for onsite consumption, would give an immediate financial lift to both businesses and consumers. This is a proven strategy used by other European nations to revive their hospitality sectors.
The Role of Staffing Agencies in the Recovery
While policy reform is crucial, there is much that businesses can do now to stabilise operations and prepare for recovery. That’s where Selective Personnel comes in.
We’re more than a staffing agency - we’re your partner in navigating this challenging landscape. Here’s how we can help:
Flexible Staffing Solutions
We provide temporary and long-term staffing that adapts to your business’s fluctuating needs, helping you maintain service standards while controlling costs.
Strategic Hiring Advice
We stay up to date with policy changes and tax incentives that can benefit your business. For example, we can help you identify and recruit from groups (like under-30s or long-term unemployed) who may soon fall under NIC exemptions.
Access to a Talented, Motivated Workforce
Many hospitality professionals are still eager to work - but they’re looking for the right opportunities. We help match these individuals with businesses that value their experience and potential.
Supporting Pubs and Independent Venues
Our work with pubs, hotels, and local businesses helps keep these vital community hubs staffed, profitable, and open - even in the face of adversity.
What Industry Leaders Are Saying
Kate Nicholls, CEO of UKHospitality, summed up the challenge in a recent statement:
“Hospitality is being taxed out of the ability to create jobs and drive growth. Without urgent action, we risk losing tens of thousands more jobs and closing thousands of venues that contribute so much to our economy and culture.”
We at Selective Personnel echo that sentiment - and believe that with the right mix of policy reform, employer resilience, and strategic staffing, the industry can weather this storm and come out stronger.
How We Can Help You Today
If you’re a hospitality employer feeling the weight of rising costs, we invite you to talk to us. Whether you need:
Relief staffing for a busy season
Advice on NIC changes and workforce planning
Help finding long-term, reliable front- or back-of-house professionals
We’re here to support you.
Let’s rebuild hospitality together.
Contact Selective Personnel today to discuss your staffing strategy.