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UPDATE 1-UK hospitality trade warns of more than half a million job losses

Tue, 6th Oct 2020 11:59

(Updates with UK Hospitality figures)

By David Milliken

LONDON, Oct 6 (Reuters) - Britain's hospitality trade is
likely to see more than half a million job losses after the
government's furlough scheme ends this month, as local lockdowns
and reduced opening hours hurt the sector, an industry
representative said on Tuesday.

Kate Nicholls, chief executive of UK Hospitality, told
Britain's parliament that recent restrictions meant she needed
to revise up a forecast of 560,000 permanent job losses -- out
of 900,000 currently furloughed workers -- that the body made
last month after surveying its members.

"We anticipate that number will be far higher now as a
result of the local restrictions, the national constraints on
events, working from home, the curfew etc," she told the
Treasury Committee, which is examining job support measures.

Britain is seeing a sharp rise in the number of coronavirus
cases. Since Sept. 24 pubs and restaurants in England have had
to close by 10 p.m., while many parts of the United Kingdom have
tighter restrictions on socialising.

A government support programme that paid up to 80% of staff
wages ends this month, and from November employers will have to
bring employees back part-time and shoulder a much higher share
of the bill if they want staff to benefit.

Finance minister Rishi Sunak has said he only wants to
support "viable" jobs from now on, and the Bank of England
forecast in August that the jobless rate would jump to 7.5% by
the end of the year from 4.1% in the three months to July.

Nicholls said around half a million of the 3.2 million
workers in the hospitality sector lost their jobs at the start
of the lockdown in March, but only 5% had been laid off since
then, due to support from the furlough programme.

The new scheme would lead to significant renewed job losses,
she warned, adding that many pubs and restaurants now risked
insolvency.

"Ninety-one percent of our members said that the job support
scheme ... wouldn't be able to help them retain jobs because of
the additional costs and restrictions that they were facing,"
Nicholls said.

The Confederation of British Industry told the same hearing
that said Sunak may need to offer more generous job support if
the number of coronavirus cases continues to rise.

"We may need to look at the way the scheme is designed over
the coming weeks, particularly if the crisis escalates over the
winter months, and we do think that for certain sectors ... we
may need to see additional support," the CBI's chief economist,
Rain Newton-Smith, said.
(Reporting by David Milliken, Editing by Estelle Shirbon and
Catherine Evans)

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