Premier Inn to axe 1,500 jobs as Covid pandemic batters hospitality industry

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Whitbread, owner of hotel chain Premier Inn, has confirmed it is chopping around 1,500 jobs as Covid-19 sees sales plunge.

The group, which also owns chains including Beefeater and Brewers Fayre, said the redundancies were far fewer than the 6,000 initially feared.

Whitbread, the UK’s largest hotel and restaurant group, said it was able to safeguard more jobs than it thought as employees accepted fewer hours.

It had previously predicted that up to 6,000 employees could be made redundant thanks to lockdown restrictions keeping its services shut.

Owners saw like-for-like UK accommodation sales tumble 56% in the 13 weeks to November 26, while food and drinks sales plunged by 54.4%.

But it said accommodation sales slumped as much as 66.4% in the five weeks to December 31 as restrictions tightened, with total UK sales down 73.4%.

Only a quarter of rooms across the firms 800 hotels were open and occupied in November, bosses said.

As coronavirus continues to hammer the UK, a third of hotels have been forced to shut.

The rest are open only for essential business and key worker accommodation. Restaurants are takeaway only in a bid to stop the virus spreading.

And global travel has largely been warned against by health officials.

Chief executive Alison Brittain called on the Government to extend the business rates relief and a VAT reduction as hotels were prepared to close until Easter.

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She said a move to extend the relief would be a "good policy decision for the Government, because hospitality does have the opportunity to bounce back and help the economy recover as and when we come out of this pandemic".

She said: "We expect the current travel restrictions in the UK and Germany to remain until, at the very least, the end of our financial year.

“With the vaccination programme underway, we look forward to the potential gradual relaxation of restrictions from the Spring.”

Demand grew in September, according to the latest figures, before dropping off a cliff in November.

Figures showed hotel demand being at 58% prior to the second lockdown, which continued through October, before paring back sharply to 35% in November as restrictions were again imposed.

William Ryder, equity analyst at Hargreaves Lansdown, said: "This hasn't been a good year for hotels, and the last quarter has seen things deteriorate again for Whitbread.

"Occupancy rates had recovered to 58% in September, but the November lockdown and progressively tightening restrictions in December saw occupancy collapse.

"Now that the nation is back in a full-on lockdown, Whitbread's looking at another tough few weeks, and probably longer."

  • Coronavirus

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