April cost increases ‘could force 65% in hospitality to cut jobs’

Trade bodies call on Government to delay employer NICs changes.

Northern Ireland’s hospitality sector is warning of significant job losses and business closures due to rising employment costs and reduced rates relief set to take effect in April. Industry trade bodies are urging the Government to delay changes to the employer National Insurance Contributions (NICs) threshold to protect jobs and investment.

A joint survey conducted by leading hospitality associations reveals deep concerns across the sector, highlighting the potential for drastic economic consequences. Key findings include:

• 65% of hospitality businesses anticipate reducing employment levels, leading to potential job losses and financial hardship for workers.
• 55% plan to cancel investment projects, stalling growth and innovation.
• 26% expect to reduce trading hours, impacting service availability.
• 28% report having no cash reserves left, up sharply from 15% in Q3 2024.
• 22% believe they will have to close at least one site, signalling potential permanent losses for communities.

A call for Government support

Hospitality Ulster, The British Beer and Pub Association, the British Institute of Innkeeping, and UKHospitality emphasise the sector’s vital role in economic growth. They argue that delaying the employer NICs threshold changes would prevent immediate job losses and investment cuts, allowing hospitality to sustain and accelerate its economic contributions.

When surveyed about potential government support, businesses identified two key priorities:

1. A reversal of employer NICs changes.
2. A lower VAT rate for hospitality to alleviate financial strain.

Industry leaders sound the alarm

In a joint statement, the trade bodies warned of severe repercussions if the Government proceeds with its planned cost increases:

“These figures should serve as a clear warning that pubs, brewers, and hospitality venues will be forced to make painful decisions to weather these new costs. The impact on businesses, jobs, and communities will be devastating.”

“At a time when hospitality has been one of the top contributors to economic growth, the Government should not be imposing additional costs that threaten employment and stifle expansion. We urge them to delay these changes to safeguard jobs and allow the sector to continue driving economic recovery.”

“If it doesn’t act then businesses are clear that the impact on communities, employees and supply chains will be significant. They have warned about potential lost earnings, lost jobs, reduced trading hours and, in some cases, business failure. This would mean the loss of essential community hubs that would otherwise drive the local economy and create jobs.”

“Our message to Government is to delay its changes to the employer NICs threshold and allow hospitality to continue to deliver economic growth, regenerate our high streets and support local communities.”

Northern Ireland’s hospitality sector at risk

Colin Neill, Chief Executive of Hospitality Ulster, reinforced the urgency of the situation:

“The results of this survey confirm what we have been telling politicians for years now: that the conditions in which hospitality businesses are being forced to operate will result in closures and the loss of employment. This should be the final warning for elected representatives in both Stormont and Westminster that the upcoming changes in April will be a body blow for many hospitality businesses.”

“This will be especially felt in Northern Ireland, where the hospitality sector is the fourth largest employer in the private sector and the backbone of our tourism industry. While we continue to take the fight to Westminster over VAT reductions and the reversal of these disastrous cost increases, we are calling on Stormont to deliver an interim support package to safeguard against the worst of these cost increases and accelerate the process of business rates reform.”