UKHospitality CEO Allen Simpson has warned that the National Minimum Wage rise announced in last month’s Budget could see the sector shed a further 100,000 jobs, with pub and hotel businesses finding it “increasingly harder” to employ young people.
UKHospitality has warned the sector could lose a further 100,000 jobs as a result of the latest Budget, with increases in the National Minimum Wage making it “increasingly harder” for employers to hire younger members of staff.
CEO Allen Simpson told the BBC that though those aged between 16 and 24 make up 10 percent of the UK’s total workforce, they represent approximately half of those employed in key customer service roles across the industry.
“Employing people at the start of their career is increasingly expensive,” said Simpson. “It is increasingly harder for employers to hire people.”
Referencing the 100,000 jobs already lost since the 2024 Budget, Simpson added that this figure included “many early career opportunities,” and that it was “entirely plausible” that a further 10,000 similar positions could be lost come April, when the hourly rate increases.
The latest data from the ONS reveals that 702,000 people aged between 16 and 24 are currently unemployed, up 60,000 on this time last year, while “monumental increases in rateable values” pile the pressure on businesses.
According to UKHospitality, the rate reforms announced by the Chancellor on 26 November will see bills for hotels rise 115 percent and 76 percent for pubs, with the average pub paying an extra £12,900 over the next three years.
“The eye-watering increases pubs, hotels and other venues are now waking up to was exactly the reason why the Treasury had to implement the maximum possible discount,” said chair Kate Nicholls. “The decision not to do so will lead to higher bills next year.”
“Pre-Budget nerves” and rising wage costs stall November recruitment
Two recent surveys produced by KPMG and the Office for National Statistics found that recruitment across the UK stalled during November, as companies halted hiring ahead of the Budget.
KPMG and the Recruitment and Employment Confederation’s report revealed permanent placements declined month on month, while the ONS reported that the rate of unemployment reached 5 percent.
“The KPMG-REC index measuring the supply of permanent jobs was 45.5 last month, with redundancies and fewer vacancies driving the second fastest rise in candidate numbers since 2020,” reported hospitality journal Propel. “It was a slight improvement on the 45.2 figure for October. Any reading below 50 signifies contraction.”
“Lisa Fernihough, head of advisory at KPMG UK, said the figures showed the market ‘remains stuck in contraction,’ with hiring ‘kept on ice’ by budget uncertainty and high employment costs. Neil Carberry, chief executive of the REC, said employers may delay major hiring decisions until January, adding that while the budget ‘was not the horror show of last year … there was little in it to fire the heart of firms.’”
The latest employment index from accounting firm BDO echoed the survey findings, dropping from 93.95 to 93.53, while output declined from 102.75 to 98.12.
“The run-up to Christmas is usually a golden time where business booms and revenues are shored up,” said BDO’s head of growth Scott Knight. “But so far this year it’s falling flat.”
Originally published on Coinslot on December 15, 2025. Republished with permission.