Two-Thirds of UK Hospitality Businesses Plan Job Cuts and One in Seven Face Closure Amid Rising Costs, Major Survey Reveals [UK 2026]

A major new survey has revealed the severe pressure facing the UK hospitality sector, with 64% of businesses planning to cut jobs and one in seven warning they may be forced to close permanently.

The industry-wide survey of over 20,000 hospitality venues, conducted by leading trade bodies, highlights the damaging impact of April’s cost increases, including higher employer National Insurance Contributions, business rates changes, and rising wage bills.

Key Findings from the Survey

• 64% of hospitality businesses plan to reduce staff numbers
• One in seven (approximately 14%) say they will have no choice but to close
• 42% intend to reduce trading hours
• 51% will cancel or delay investment plans

Many operators described the combination of rising costs as “suffocating”, warning that the sector is facing one of its toughest periods in recent years.

What’s Driving the Crisis?

The main pressures include:

• Increased employer National Insurance Contributions
• Changes to business rates relief
• Higher National Minimum Wage and National Living Wage
• Ongoing inflation in food, energy, and other operating costs

The findings come just days after the new financial measures took effect on 1 April 2026.

Impact on the Sector

The hospitality industry employs millions of people across pubs, restaurants, hotels, and cafes. Trade bodies have warned that widespread job losses and closures could have a serious knock-on effect on local economies and high streets across the country.

Industry leaders are calling on the government to provide urgent support, including a permanent reduction in VAT for hospitality and a full review of business rates.

What do you think? Have you noticed any hospitality businesses in your area reducing hours or struggling? Do you support more government help for the sector? Share your views in the comments below.

FAQs

Q1. How many hospitality businesses plan to cut jobs? 64% (two-thirds) of businesses surveyed plan to reduce staff.

Q2. What percentage may close? One in seven (around 14%) say they could be forced to close.

Q3. When did these cost increases begin? The main cost rises came into effect from 1 April 2026.

Q4. Which types of venues are most affected? Pubs, restaurants, cafes, and hotels are all feeling significant pressure.

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