£ 500 million to the government Restaurant and bar meals support It failed to improve finances for the UK’s hospitality and catering sectors in the third quarter, according to a business survey.
British Chambers of Commerce said 66% of respondents in the hospitality and catering sector reported lower sales and reservations between June and the end of September.
Citing responses to the Quarterly Economic Survey, which questioned 6,410 companies employing 580,000 employees, the BCC said the revenue drop in two-thirds of the hospitality and restaurant businesses was significantly greater than the average decline in all sectors of 46%.
A BCC spokesperson said the “Eat Out to Help” scheme, which ran throughout August and introduced discounts on meals in bars, restaurants and cafes, had a “somewhat marginal” impact on the sector as a whole.
Nearly a third of the companies surveyed expected their sales to decline over the next year, revealing that a large minority believes the recovery will continue until 2022.
Business surveys tend to paint a darker picture than other measures of business activity, according to some economists. The Chief Economist at the Bank of England, Andy Haldane, Consistently argued that the recovery was stronger than expected and that overall activity would be only marginally below the pre-pandemic level by the end of the year.
Suren Thiru, head of economics at BCC, said there had been an improvement from the drastic drop in activity in the previous three months in the third quarter, but rejected suggestions for a quick V-shaped recovery.
He said The The stock of companies in the service sector that reported an increase in domestic sales jumped to -25% from -64% in the second quarter. The balance report increased export sales to -31% in the third quarter from -55%.
He said that the better performance of the manufacturing sector helped boost the average of all sectors, but the increase in the stock of companies reporting an improvement in domestic sales to -15% from -59% was not enough to generate a strong recovery.
Therou also said Chancellor’s Winter Economic Plan Last week it was announced that it was likely to provide only a short-term boost while domestic Covid-19 restrictions on businesses and households remain in place, and that third-quarter earnings may fade in the lead up to Christmas.
“The continued weakness in cash flow is worrying as it makes companies more vulnerable to external shocks, including more restrictions,” he said.
In the third quarter, 21% of companies reported improvement in cash flow, 34% unchanged and 45% reported deterioration. Firms have also remained reluctant to invest in new factories, machinery and office space while local closures continue to threaten income.
The BCC said 37% reported a decrease in investment in the plant, while 46% expected to maintain investment plans that have fallen to their lowest historical levels since the outbreak of the pandemic. Only 17% of companies plan to invest, up slightly from 9% in the second quarter.
Adam Marshall, Director General of the ACC, said most of the fieldwork for the survey had been done before the prime minister said the “second spike” of the coronavirus had hit the UK on September 18. “Our findings clearly show that business conditions remain fragile in the face of uncertainty, with the prospect of a difficult winter to come.
The economy will need more support, on top of the adviser’s recent efforts. Ministers must be prepared to provide this support, and to strengthen measures to support the cash flow of business and jobs. “