Finance

Hospitality sector faces bleak Christmas as employers pull parties

Hospitality venues have been hit by a wave of Christmas cancellations following mixed messages from government about the new Omicron coronavirus variant and whether parties should still go ahead.

Industry trade group UKHospitality said that festive bookings were 30 per cent below expectations for this time of year, estimating that across the sector about 10 per cent of bookings had been cancelled since the new variant was first identified a week ago.

The lost business deals a fresh blow to a sector still reeling from the pandemic. Sales across hospitality businesses in the year to the end of September were £73.1bn — almost half of what the industry generated in 2019. Since March 2020, 8 per cent of venues have closed, according to industry data firm CGA.

Jenny Harries, chief executive of the UK’s Health Security Agency, warned on Tuesday that people should avoid socialising “when we don’t particularly need to”. But her comments were countered by Boris Johnson, prime minister, and health secretary Sajid Javid, who said that Christmas parties should go ahead.

Pubs, bars and restaurants have been relying on the busy period running up to Christmas to recoup some of the losses incurred during lockdowns. The industry is also battling steep increases in labour, food and energy costs.

But the Omicron variant has sparked unease among employers. Restaurant owners and large venues, particularly in big cities, reported the biggest drop-off in bookings as companies pulled plans for Christmas parties just days before they were due to go ahead.

The BBC and NHS Providers are among organisations to have requested that staff avoid large gatherings. Mark Derry, executive chair of the Brasserie Blanc restaurant group, said 1,600 bookings across its 14 restaurants had been cancelled in the last four days.

Peter Marks, chief executive of the UK’s largest nightclub operator Rekom UK, said five of its venues that rely on large corporate events lost 30 per cent of their bookings this week.

Marcos Fernandez Pardo, managing director of the Iberica restaurant group, said that around 10 per cent of covers had been cancelled and that he was “expecting a worse Christmas than we anticipated only last week”. He added that the company had started to prepare contingency plans for a two week lockdown “in case we have a repeat of last year”.

Despite the government mandating that face masks be worn in shops and on public transport, no restrictions have been put in place for hospitality businesses. Scientists are still working to determine the risk posed by the Omicron variant, but the World Health Organisation said on Wednesday that early indications were that the effects of the new variant were “mild”.

“It is hugely challenging to have all this current environment with the mixed messaging,” said Kate Nicholls, chief executive of UKHospitality. “We can continue to reassure people both guests and staff that we are a safe place to socialise.”

Several venues, including London’s Royal Opera House, have voluntarily brought back safety measures such as face masks and temperature checks.

Michael Kill, chief executive of the Night Time Industries Association, said that the uncertainty had prompted customers to “make snap decisions” over whether to go ahead.

Hugo Campbell, co-founder of Feast It, said that corporate organisers had started to request that all those working at events took a gold standard PCR test — rather than the more common lateral flow — while David Moore, owner of the London restaurant Pied à Terre said he had reintroduced temperature checks for guests and had returned to disinfecting the restaurant with a fogging machine at night.

Additional reporting by Daniel Thomas

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