Press release: Tourism industry survey confirms majority of businesses in sector are economically unsustainable if 2m physical distancing rule remains
Press Release
For immediate release
23 June 2020
Tourism industry survey confirms majority of businesses in sector are economically unsustainable if 2m physical distancing rule remains
The Scottish Tourism Alliance, the representative body for Scotland’s tourism businesses has published the findings of its latest research into the economic viability of businesses within the hospitality sector under the 2-metre physical distancing rule.
The two surveys which ran between 16 – 21 June focused on accommodation providers and restaurants which are two of the largest employers within the hospitality sector in Scotland. The primary purpose of the surveys was to highlight to the Scottish Government the potential impact on businesses and job loss should the 2-metre physical distancing rule remain in place on account of scientific data. The surveys were also conducted to highlight the scale of longer-term financial support that will be required to protect businesses from total collapse. The organisation also sought to build a picture of how many businesses will be able to open from the indicative date of 15th July.
Highlights from the survey:
- 69% of hotels surveyed said that they were planning to reopen in July. 11% however said they had no plans to open. 5% are already open to key workers and those who require accommodation due to work.
- Almost a third of hotels surveyed confirmed they were not planning on reopening from 15th July and said that this was down to the 2m physical distancing restrictions which make it economically unsustainable for their business to operate.
- 78% of hotels surveyed said they would lose more than 50% of turnover with 11% saying that they cannot afford to continue to stay open if physical distancing restrictions are not reduced to 1 metre.
- 83% hotels surveyed said that their business would be financially unsustainable if they were required to trade at 2 metres physical distancing without any additional support beyond the next 2 months. This could result in there being up to c25,000 job losses from those surveyed (if we look at the higher end of full/part time employment figures submitted by those businesses).
- 87% of restaurants surveyed said they would lose more than 50% of business with 23% saying that they cannot afford to continue if physical distancing restrictions are not reduced to 1 metre.
- 85% restaurants said that their business would be financially unsustainable if they were required to trade at 2 metres physical distancing without any additional support beyond the next 2 months. This could result in there being up to c8,900 job losses from those surveyed (if we look at the higher end of full/part time employment figures submitted by those businesses).
- 75% of self-catering, B&B and caravan and camping parks said they plan to be open in July. Despite these types of accommodation having fewer employees and being more self-contained, 11% are still saying that they have no plans to open with the current 2 metre physical distancing rule.
The organisation also gathered similar data from colleagues at the Association of Scotland’s Visitor Attractions (ASVA), the Scottish Beer & Pub Association (SBPA) and Wild Scotland. The combined response from the sector totals more than 2000.
Marc Crothall, Chief Executive of the Scottish Tourism Alliance said; “The survey confirms that around 85% of businesses within the hotel and restaurant sectors in Scotland will stop trading if the 2 metre physical distancing rule remains in place for the next two months should no further financial support be forthcoming. The figures reflect the many conversations we have been having with businesses across all sectors in the tourism industry for months and underline just how crucial the current review of the 2-metre physical distancing rule is within the context of the health and economic crises.”
“Our tourism industry has welcomed the publication of the sector guidance for reopening and fully supports all recommended measures to ensure the safety of employees, visitors and our communities. However, many businesses do not plan to open again with the 2-metre rule in place as it’s simply not economically viable for them to do so. Coupled with the expected slow recovery forecast, we expect a steady stream of job losses across the whole of Scotland over the coming weeks. Also, as we all know, visitors will choose where to stay based on the tourism product available in that area and are unlikely to travel to destinations that have a limited product in the form restaurants, visitor attractions and pubs. This will have a direct knock on effect on the current limited demand for accommodation in our destinations and the impact on our local economies and supply chain is likely to be severe.”
We will be sharing the results of our research with the Tourism Secretary on our STA Council call with him this afternoon and we will be requesting a call with the First Minister to discuss our findings in more detail.”
Click here to download the research findings.
ENDS
