64% of Businesses to Cut Jobs Amid Cost Increases

In Brief: A recent survey in the UK reveals that nearly two-thirds of hospitality businesses are planning to reduce their workforce due to escalating operational costs.

UK Hospitality Survey: 64% of Businesses to Cut Jobs Amid Cost Increases – Image Credit Unsplash

UK hospitality trade groups report that cost increases taking effect in April will lead 64% of businesses to cut jobs, with additional impacts on investment, trading hours, and closures, according to a new member survey.

A survey conducted by CGA, in partnership with NIQ, in February 2026, with respondents operating more than 20,000 hospitality sites, found that increases in employment costs and business rates in April will result in significant operational changes across the UK hospitality sector. The survey, carried out on behalf of UKHospitality, the British Beer and Pub Association, the British Institute of Innkeeping, and Hospitality Ulster, identified that 64% of businesses plan to cut jobs as a direct result of these cost increases.

In addition to job reductions, 51% of surveyed businesses indicated they would cancel investment plans, and 42% said they would reduce trading hours. Approximately 15% of venues expect to be forced to close due to the rising costs.

Energy costs were identified as a major concern by nearly all respondents, with 93% reporting that energy prices were affecting profitability. These findings were reported prior to recent developments in Iran and the Middle East.

Respondents expressed support for a reduction in VAT for hospitality (89%), permanent reform of business rates (74%), and changes to employer National Insurance Contributions (65%).

Seventy percent of businesses said that, if the sector’s tax burden were reduced, they would prioritize refurbishing and developing existing sites.

In a joint statement, the trade bodies highlighted the scale of the additional costs facing hospitality businesses in April, noting that these increases would force many to make difficult decisions regarding jobs and operations. The statement referenced support for pubs on business rates but noted that other types of venues, including restaurants, hotels, and cafes, would see significant increases in their bills.

The statement also addressed the impact of rising energy prices on profitability and called for government preparedness to support vulnerable businesses in the event of further crises. The trade groups reiterated their position that measures such as a lower VAT rate, business rates reform, and changes to employer National Insurance Contributions would support job retention, investment, and growth in the sector.