The Scottish hospitality industry was thrown into crisis when the pandemic struck in early 2020.
Thankfully, it has been some time now since the restrictions which forced pubs, hotels, and restaurants to close their doors were lifted completely. But in the slipstream of Covid has emerged a whole litany of acute operational challenges, the culmination of which in some cases is leading businesses to shut for good.
A recent survey revealed that there was a sharp rise in the number of pubs permanently closing in England and Wales in the first half of the year. The survey, by commercial property firm Altus, found that 383 pubs were lost to the trade over the period, with 230 of those closing in the three months to June 30.
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Although the figures related to the industry south of the Border, the pub trade in Scotland faces many similar challenges, and further closures north of the Border are expected.
Hard on the heels of Covid came shortfalls in labour – partly because staff moved to other industries during lockdown and partly down to Brexit – and global supply-chain upheaval. The latter meant shortages of raw materials like dry goods and higher transportation costs, which ultimately put up the price of some food and drink.
But the problems did not end there. The industry has since had to contend with a breathtaking surge in energy prices, with the spike in bills contributing to a general cost inflation crisis. Alongside that has been the cost of living crisis facing consumers, which has curbed their disposable incomes.
The ongoing pressures facing the hospitality sector were underlined in a major survey published by the Scottish Licensed Trade Association last week.
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With 72% of respondents found to be struggling to fill vacancies and 68% of outlets under-staffed, the SLTA said labour shortages effectively mean businesses have no choice but to reduce operating hours, thereby undermining their economic viability and role as part of the Scottish tourism industry.
Equally worrying were findings that 58% of outlets were trading at pre-Covid levels and that 67% are expecting further economic decline. A concerning 9% said they were planning to close for good or considering their options.
With businesses under so much pressure, it has been no surprise to see the industry step up calls for action to ease the crisis. Industry groups are making representations for the UK Government to reduce the rate of value-added tax applied to the tourism and hospitality sector, and for Scottish ministers to reduce the burden of business rates.
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