Survey: UK Hospitality Sentiment During the Coronavirus Crisis
Uncertainty about economic recovery remains high in the UK hotels sector, with few respondents feeling optimistic in their outlook for the next 12 months.
These are extraordinary times for the UK hospitality sector. Whilst there is plenty of individual comment in the industry press and wider news, it can be hard to arrive at a consensus for the UK hotel industry.
To this end, psd invited over 400 senior leaders from UK hotel businesses to take part in our inaugural Hospitality Sentiment Survey. This allowed us to create a detailed picture of the current opinions and outlook for the hotel sector.
To arrive at a 360° view, we approached leaders at corporate, property and departmental levels. Each group was provided with a tailored set of questions, to gauge differences of opinion and thinking at each level.
We would like to thank all that took part in this exercise and are pleased to present our results as follows.
We see the key takeaways as follows:-
- Businesses have adopted a variety of strategies to manage payroll costs. The majority have embraced the government furlough scheme and over half of the respondents shared that they’ve also had to take redundancy measures.
- Perhaps as expected, guest safety and confidence, and employee safety, are the top priorities for most over the next six months. M&A activity ranked as least important despite perceived value becoming available the longer the pandemic goes on.
- Lack of international inbound business to the UK is seen as the biggest single challenge to the hospitality sector. This is followed by uncertainty as a result of government advice and corporate policy (homeworking, reduced business travel etc).
- The ban on sporting and music events, and corporate restrictions/cost saving were also noted as significant challenges to the sector.
- Sadly, but not surprisingly, anxiety from team members who’ve had to manage emotional discussions over calls was reported, which serves as a reminder to the growing concern around mental health & wellbeing during this tumultuous time in a sector that has been hit to an extent never seen before.
- Lack of confidence remains high for many in their business outlook for the next 12 months.
- With over sixty percent of respondents now re-opened and some twenty percent not having closed at all, the challenges of a severely contracted marketplace become ever more stark.
- Once again, the government furlough scheme was a measure that most businesses have taken to protect jobs but nearly half reported that redundancies had also been made.
- Post opening, forty percent anticipate restructuring and expect to reduce headcount between ten and thirty percent.
- As with corporate office respondents, GM’s also see the lack of inbound international business to the UK as the biggest challenge to the hospitality sector, followed by uncertainty as a result of government advice and corporate policy (homeworking/reduced business travel).
Heads of Department
- Interestingly and somewhat at odds with the above, over thirty percent of respondents reported that their jobs had not been affected by the pandemic.
- Conversely, just under ten percent had already been made redundant, with another four percent under consultation of redundancy.
- Respondents felt that their leadership have largely provided regular communication in the form of calls, Zoom and MS Teams meetings. As a result, over seventy percent reported a sense of loyalty towards their leaders.
- Whilst three-quarters still feel positive about the hospitality sector, seventeen percent would now consider career choices in other sectors, and seven percent are actively looking.
Whilst the hotel sector is undoubtedly under immense pressure in the UK, it is also clear that its biggest asset, its people, remain remarkably resilient and passionate about our industry.
The outlook however remains very challenging. It is difficult to predict when a return to pre-pandemic levels of business will be achieved but it is now clear that the timeline is years, not months.
Protecting jobs has been a priority and, thus far, supported by the government. With the furlough scheme ceasing at the end of this month and the new Job Support Scheme far less generous, there must be serious concerns around permanently losing a percentage of our workforce as they look to other sectors for employment.
Since this survey was carried out there has been a further significant rise in COVID-19 cases. Clearly greater restrictions on freedom and movement with local lockdowns and potentially another national lockdown will devastate the industry we love. We intend to carry out a follow up sentiment survey in Q1 2021 in order to assess what, if anything has changed.