Will the Autumn Budget address UK hospitality’s biggest challenges?

Higher energy costs, chef shortages and food price inflation are some of the UK’s biggest hospitality challenges, leading to an estimated 50 pub closures per month. Will the Autumn Budget address these issues?

Autumn Budget 2024

All eyes are on the new Labour Government as their first budget approaches on 30 October 2024. The hospitality sector in particular seeks business rates reform and investment to deliver economic growth. 

UK Hospitality’s Q3 member survey revealed how almost every hospitality business has seen steep increases in wages and food costs, citing the biggest challenge as wage costs, closely followed by food, insurance, and then energy costs. 

National Living Wage and staffing concerns

CLH reports “an anticipated rise in the National Living Wage, along with skyrocketing energy bills all threaten to further erode pub profitability” while UK Hospitality urges government to introduce business-friendly recruitment measures and cautions against excessive minimum wage increases. 

Even if open vacancies and chef shortages were not a concern, many business owners fear they simply cannot afford wage increases. UK Hospitality reports that vacancies have fallen below 100 000 for the first time since the pandemic, but wage pressures remain. Wage costs now represent at least a third of overall business costs, and some budget predictions see an increase for employer NI rates. 

Short Term Solutions 

While the Autumn Budget may address hospitality concerns and provide some relief for business owners, proposed reforms will take time to implement.

With persistent chef shortages and wage pressures, short term solutions need to be implemented. Chef hours need to be reduced where possible – outsource slow-cooked menu items to limit mise en place and hours spent on sauce reductions. Experienced chefs will have more capacity for skilled work and apprenticeship, while maintaining a consistent high standard of food. 

Similarly, modern restaurant design changes expand seating capacity while limiting kitchen space. Smaller kitchens can accommodate increased covers by cleverly integrating products from a high quality supplier. 

UK hospitality challenges are far from over, but the industry remains positive that the Labour government will uphold its manifesto commitment in the Autumn Budget.