Hospitality and The Hard Truth of Brexit
Antony Woodcock, MD

I’m never one to stray too far from the truth, regardless of how unpopular it may be and I am afraid that once again I will probably find myself in the firing line for telling it how I see it. The time has come however to strip back the veneer and be brutally honest about the immediate future of the industry that I know and love.

For years now the UK hospitality industry, London specifically, has been completely and utterly dependant on our mainland neighbours to the south with regards to staffing our typically lower paid jobs. I say lower paid rather than lower skilled as as a hospitality professional I never underestimate nor take lightly the impact of an experienced, hard working maid, cleaner, kitchen porter or waiter. They are the backbone of our industry and as many of you will be experiencing currently, we can not operate without them. Your hotel could more than likely survive the business day without your General Manager but I challenge you to keep it running without enough maids.

Why has hospitality been able to pay so little for so long when other industries seem to have adapted...

We have all been slowly but surely feeling the impact that Brexit is having on recruitment and if you haven’t then you are one of the lucky few and I’d love to know what it is you are doing. Wednesday last week however seemed to be the final straw that broke the camel's back. A leaked paper from the home office setting out post Brexit immigration proposals seems to have taken an uncertain situation and turned it into all out panic. If uncertainty has been the cause of rapidly declining net migration figures then what impact will panic have?

So now the Great British public has decided to strip away this workforce and send them back, so that we can return to Britain for the British. As much as I don’t agree with the sentiment I can understand it. There are many hard working Brits who can't find work and unless you really understand what's going on out there, it's easy to see other nationalities working in our bars and restaurant and just make a sweeping statement that that’s a job that could easily be filled by an unemployed Brit. The truth is however that most Brits wouldn’t do that same job for the amount of money a migrant would.

Now who’s to blame for the impending labour shortage? Certainly not the migrants who are leaving the country or not coming in as they did before. No it is our fault, the business owners and operators. That includes me just to be clear, as someone with interests on both sides of the employment fence (an employer and a provider of staff) I have to admit that I am guilty of paying the industry average.

For too long we have exploited this willing workforce to keep our staff costs at a minimum. We got complacent because we thought the supply would never end. We have taken this work force for granted and by the looks of it they have had enough and who can really blame them.

For too long we have exploited this willing workforce to keep our staff costs at a minimum. We got complacent because we thought the supply would never end…

In very quick hindsight, a paragraph to be specific, it probably is a little bold to say that businesses owners and operators in the space are solely to blame. Most business costs have gone up but our prices haven't and so we manage the situation as best we can. We might not be completely to blame but we are certainly responsible for what we do next.

What do we do next? Well it’s fairly simple, painful for most businesses to accept but simple all the same. We have to match our competing industries pay. We have to meet the pay expectations of the British public as we try and encourage them to fill the gap that’s being left behind. Is it really a bad thing either, we should have been increasing our pay rates incrementally over time anyway to stay competitive but instead of increasing at 10/20p a year, most of us will now have to accept a jump of £1 plus in as much as a matter of weeks and months.

The next three months are traditionally the industry's busiest which make them the hardest. This year however they have the potential to be one of the hardest of all time…unless we all work with one another to make it through. We need to be honest with ourselves and honest with each other about the challenges we face and the difficult but simple solution hanging over our head.

GIG will be reaching out to all its partners with regards to sitting down in the coming weeks to discuss the current industry issues and our strategy with regards to managing these.

GIG partner or not if you would like to discuss any of the issues highlighted in this article please do not hesitate to get in touch.

Further Reading:

https://www.theguardian.com/politics/2017/sep/06/eu-citizens-in-disbelief-over-uks-le http://www.telegraph.co.uk/business/2017/07/03/hospitality-industrys-rapid-growth-threat-without-government/ 

http://www.independent.co.uk/news/business/comment/brexit-to-cause-60000-job-hospitality-recruitment-shortage-industry-warns-but-will-government-listen-a7659671.html

http://www2.cipd.co.uk/pm/peoplemanagement/b/weblog/archive/2017/06/19/low-paying-sectors-turn-to-eu-staff-because-they-can-t-recruit-brits-study-finds.aspx

 http://www.unitetheunion.org/news/hospitality-bosses-told-to-smell-the-coffee/