Hospitality and Brexit: what comes next
March 29th 2017 marked the day Britain announced its intention to leave the European Union. While (at the time of publication) the terms of leaving are still not cemented, discussions are continuously taking place and many industries have voiced their concerns. One of the biggest issues being raised frequently is, with the potential retraction of free movement for EU citizens, will there be an adverse impact on the country’s workforce? In particular, hospitality and tourism are markets where there have been growing levels of uncertainty fuelled Brexit. Hospitality is the fourth-largest industry in Britain, employing 4.49 million people across the UK, and since 2010 has being responsible for creating every 1 in 5 jobs being advertised.
Research has shown that 25% of UK hospitality jobs are filled by people from the EU, with London boasting almost 70% of their hospitality staff being EU nationals. This is a huge number of people, and a significant amount of the industry workforce, who face increasing uncertainty as talks between the UK government and the EU continue. The Prime Minister recently released a white paper detailing her plan to permit EU workers to continue working in the UK after it withdraws from the EU, a plan which was met with a positive reaction from those within the hospitality industry. CEO of ‘Association of Licensed Multiple Retailers’ (ALMR), Kate Nicholls, has been quoted saying, that this document represents the clarity desperately needed by the hospitality industry. However, this Is not legislation that is in any way assured. MP Jacob Rees Mogg has been vocal over the fundamental issue that at no point has it been stated that EU citizens will have any additional rights to work in the UK compared to those from the rest of the world. As well as this, there was no outline to suggest which jobs the EU citizens would qualify to stay for and no definition of the ‘temporary’ nature that was also outlined.
As potentially a quarter of the workforce may imminently be taken away from the UK’s hotels and restaurants, it is imperative that plans are put in place to mitigate the effects Brexit may have. There is a perception among EU workers that hospitality is a viable career path, compared to many UK residents who often view these positions as only a ‘job’, not a career. This may be the best approach when attempting to secure the UK hospitality industry’s future. If a committed work force can be built by the industry within the UK, the future may not be as bleak as it first appears.
It is possible that the nation’s ‘staycation’ industry could flourish in a post-Brexit society when international travel becomes more difficult. 27% of Scots said they are planning to spend more holiday time within the UK, with 42% of Scottish holiday markers stating they would choose a ‘staycation’ over international travel – even if their finances allowed. This could be beneficial as the UK had thethird slowest growing economy last year across the countries within the EU, mostly attributed to impact of Brexit.
Despite Theresa May’s aforementioned stance, the future of VISA requirements for EU citizens is unknown - ultimately increasing the unpredictability surrounding travel as a whole into and out of Britain. A reduction of foreign travel into the UK could see the tourist and hospitality sector suffer. Although this could be a potential concern, the rise in staycations, well as the recent trends with investors, are reasons to be hopeful. Investors have been seen to be taking advantage of the recent state of the Sterling, with a potential for growth and development from overseas investors becoming clear. Britain recently won the title for Europe’s most in demand country for hotel investment. This is one factor that begins to dispel concerns that the UK’s hotel and hospitality market would crumble after the Brexit decision was made.
The future for the hospitality industry has the potential for huge growth and development in the next few years due to increased domestic travel and the foreign investment potential inspired by Brexit uncertainty. However, there is a clear danger of the industry losing a significant amount of its workforce. Key to remedying this will be a change in mindset of those who will replace the current generation of hospitality workers. Targeting school curriculums to show young people that a career in hospitality is a viable one, and not just a backup, will be essential; it contains opportunities to work your way up a ladder and provide lucrative rewards. The removal of the EU workforce may only prove truly problematic for the hospitality industry if we are unable to replace them with individuals with a similar outlook to the career potential within the domestic hospitality sector. This mind set will not change overnight, however. The sooner we start, the better.
If you're looking for a new challenge in the hospitality industry, or are recruting new talent, you can contact our Hospitality and Tourism team directly by following this link.