Several pubs and restaruants have closed in 2025 as the hospitality sector struggles with several tax rises. Britain’s hospitality sector is reeling after nearly 89,000 jobs vanished since last October’s Budget, new analysis reveals – a toll far worse than previously predicted.
Figures compiled by UKHospitality, based on Office for National Statistics data, show the industry has borne the brunt of the country’s job losses, accounting for 53% of all 164,641 redundancies since the Budget. In just the past month, another 5,000 hospitality jobs have been lost.
The scale of the crisis is stark: the sector has suffered job losses at three times the rate forecast by the Office for Budget Responsibility, which estimated 50,000 would be lost as a direct result of changes to employers’ national insurance contributions. Instead, one in 25 hospitality jobs – 4.1% of the total workforce – have disappeared since October. As a proportion of its workforce, hospitality’s job losses are seven times higher than those seen across the wider economy.
UKHospitality blames the “regressive” changes to national insurance, particularly the lowering of the threshold, for directly hitting part-time and flexible jobs, which are a mainstay of pubs, restaurants, and hotels up and down the country.
Kate Nicholls, chair of UKHospitality, called the figures “staggering” and urged the government to act at this autumn’s Budget. “More than half of all job losses since October occurring in hospitality is further evidence that our sector has been by far the hardest hit by the government’s regressive tax increases,” she said. “The sheer scale of costs being placed upon hospitality has forced businesses to take agonisingly tough decisions to cut jobs – with part-time and flexible roles often those most at risk.”
“At a time when the country needs jobs, the government should be encouraging hospitality to grow and create jobs, not tax them out of existence. The government needs to recognise the devastating impact of its tax increases on working people and communities across the country.”
UKHospitality is calling for urgent reforms, including lower business rates, fixing national insurance contributions, and a cut in VAT, to stop more businesses being “taxed out” and to reverse the damage of recent tax hikes.
