According to a pub boss, the price of a pint could go up by 40p in order to make up for Christmas party revenue lost, higher inflation and soaring energy costs, as well increased wages.
Clive Watson indicated that although the expected cost increase was 25p-30p due to rising living expenses, it will go up by 10p by 2022 because of lower festive trading.
After Boris Johnson’s Wednesday announcement of new Plan B, the City Pub Group Chairman, who owns approximately 50 pubs in total, stated that people have been cancelling night outs in large numbers to prevent Covid-19.
Watson stated that December accounts for a third or more of the annual profit margins at many hospitality businesses, so they will now have difficulty building up cash in order to balance the books in the very lean months in February and January.
According to him, BBC Radio 4’s Today program reported that office parties began to be cancelled around ten days ago. This was especially true for office parties funded by companies. These parties were typically 40-50 people.
“Offices began to either cancel or postpone bookings for next year, which indicates that there has been a decline in these types of bookings. This trend is expected to continue after Wednesday’s announcement.
The average cost of a pint in the UK is £3.86 – with London the most expensive city at £5.33 and Perth in Scotland the cheapest at £3.07, according to a study carried out earlier this year by personal finance experts at Finder.
It has been revealed that the new Plan B guidelines on working at home won’t stop coworkers from meeting up in a pub for work or hosting a Christmas party. Some have suggested using WFP, or Working From Pub.
It comes as economists said UK city centres would lose £3billion next year as Britons continue to work from home – with the average person doing so 20 per cent more than before the pandemic, equating to one extra day a week.
Study by the University of Sheffield examined whether once-bustling towns would suffer if people spent less time eating lunches or coffees in office hours, and more time going to bars and shops after work.
With 77,000 employees in hospitality and retail potentially being forced to leave, the shift will also mean that 77,000 people could have to change their jobs.
A Christmas Night Out in Bristol was enjoyed by many people last night. However, one man got into the Christmas spirit wearing a Santa Claus hat to help him feel festive.
People enjoy an evening out last night at the V-Shed, a harbourside Wetherspoon pub in Bristol
After leaving Hammersmith in West London yesterday, there were empty seats aboard an early morning London Underground commuter rail.
Academics believe that the “doughnut effect”, whereby city centers are stretched out and posh areas flourish, can make inequality between rich-and-poor areas worse. They also stated that densely populated cities were most likely to suffer.
Spending in the City of London is set to be 32 per cent lower than before the virus struck while spending in central Birmingham is set to be 8 per cent lower – although while some of the cash will be recuperated in suburbs.
Lead study author Dr Jesse Matheson said: ‘We estimate that about £3billion in spending will leave city centres as a result of working from home. This spending could partly be realized in residential areas, while some might be lost.
“Surrounding neighborhoods lack the density that city centers have, so many retailers and hospitality companies will not find it profitable to move.
“Workers in hospitality and retail may find that the demand is shifting to areas where it’s too hard to commute, so supply might not keep pace with demand.
Although this money could be recuperated in higher-income suburbs, it is not feasible to work from home. This makes it less attractive for businesses like coffee shops that require high density locations.
“There’s a chance that this revenue might be lost forever from the retail and hospitality sectors.”
This could be because the government has triggered ‘Plan B’ restrictions yesterday that include new work from home guidelines.
Although the measures also include more mask wear and vaccine passports they are likely to be in effect until around mid-January, the uncertainty surrounding the Omicron variant could mean that they may last longer.
Economists at Nottingham and Birmingham universities also contributed to the study. It found that city centers may need to undergo radical changes if they want to see revival. Because they have to be more residential, it is possible that there will be less shops.
This study was based on Dr Matheson’s previous research, which showed that how quickly businesses and personal finances are able to recover after the shock caused by the pandemic is dependent on their location and the activities they engage in. The wealthy tend to rebound more rapidly.
Meanwhile the Centre for Economics and Business Research suggested the work from home guidance would cause a £505million reduction in spending in London, Manchester, Newcastle, Nottingham and Leeds.
It also found the combination of Christmas party cancellations and travel restrictions could cost the economy £1.3billion.
Nightclubs, shops and pubs all warn that Plan B’s devastating effects could cause them to lose millions of dollars during the peak times of the year.
Retailers on the high street said that city centers will be emptied as workers are told to stay home starting next week.
In the meantime, the hospitality industry has taken a hit due to uncertainty surrounding the mutant Covid strain. Despite Prime Minister’s insistence that they should continue, there have been a lot of cancellations at Christmas parties.
Experts put the cost of Plan B, which will also see vaccine passports introduced for large venues, at £4billion per month.
The Institute for Economic Affairs, a free market think tank, said that the measures could “easily” reduce the size of 2 percent. Julian Jessop an economist, says the tax measures may force taxpayers into paying billions for job loss and bankruptcy.
UKHospitality represents over 730 companies and said that Plan B would result in trade falling by 30% during Christmas. This will cause pubs to close and restaurants to be closed, as well as jobs being lost.
Kate Nicholls, chief executive of the company said that while these measures are ‘light touch’ they will have a significant impact on business.
She stated: “She told me: “It is helpful that business are kept open and permitted to trade, and that the Prime Minster still allows socialising. But there will still be an important hit.
“There will be an effect on trade, footfall, and people’s willingness go out.
“We are already experiencing a drop in trade because of concern about this variant. This is expected to rise, especially in urban centers due to the work from home guidance.
This comes after a study showed the disastrous economic effects of working remotely.
According to University of Sheffield research, the average worker will be home one more day per week in 2022 than it was before the pandemic.
On Wednesday, at a Downing Street Press Conference, the PM suggested that everyone should work again from home.
This will cost city centres £3billion in lost revenue next year alone and will have ‘huge consequences’ for retail and hospitality businesses, the study found.
Clive Watson (chairman of City Pub Group), who owns 50 pubs in the city, stated that Christmas parties are being cancelled.
Emma McClarkin is the chief executive officer of British Beer and Pub Association. She said it was a huge blow to the sector.
It further weakens consumers’ confidence, she said.
“The sector’s recovery is dependent upon the holiday season,” said Mr. Sullivan.
Shepherd Neame is Britain’s oldest beermaker and said these measures would destroy consumer confidence as well as undermine Covid’s recovery.
He said that there is no evidence to support the plan to move to Plan B. Working from home or obtaining vaccine passports would be disastrous for the chain of 320 pubs.
British Retail Consortium director, business and regulation, stated that this sector represents 170 UK retailers.
Tom Ironside stated that it was “inevitable” that any attempt to bring back advice for work at home will have an impact on footfall, particularly for retailers just beginning to get their feet under control after the pandemic.
Timpsons, a high-street shoe repair company that specialises in staple shoes for the street, saw a drop in footfall after Omicron was introduced.
Sir John Timpson stated that working at home made a big impact on the high streets during the pandemic. He also suggested that the government was “lurching” from one method to the next.
The Government’s Plan B plans are sending it backwards, he said. Sir John suggested that it was important to learn how to deal with the virus.
Today, he stated that ‘we have to be able to accept life as it is and create a better permanent environment. We can’t keep moving from one situation to the other.