Hospitality sector accused of 'shooting itself in the foot' by paying minimum wage

05-Aug-2021 - Last updated on 13-Aug-2021 at 09:31 GMT

Pay debate: Sacha Lord has suggested the industry review its salaries

The hospitality sector, including the pub trade, has been accused of “shooting itself in the foot” by continuing to pay staff the minimum wage.

Sacha Lord, night-time economy adviser for Greater Manchester, has told the industry it needs to look at what it offers or it will lose workers to other better paid industries.

"By continuing to pay staff minimum wage, the industry is shooting itself in the foot and can't expect to attract new entrants,” he said.

“It needs to now look hard and re-evaluate what it is offering its staff in terms of salary in order to really compete with other industries and survive."

Rebuild plan

He added: "As we rebuild, we can't now expect the youngest and hardest hit by the pandemic to be satisfied with minimum wage roles, when they can earn higher salaries elsewhere in office work or in retail."

However, he admitted that the industry was facing challenges and not just because of the salaries it offers.

"There are more than 2,500 hospitality vacancies right now across Greater Manchester and the depletion of staff across the industry is on a scale that is difficult to comprehend. There are severe recruitment issues and many venues are closing midweek, unable to open full time purely due to staff shortages," he added.

Brexit impact

"Not only has the workforce been decimated by Brexit and the introduction of salary-threshold visas but the closures enforced during Covid lockdowns have forced staff to leave the industry and retrain, or seek higher wages elsewhere."

His concerns come as the industry faces severe staff shortages. Recent research from Fourth showed that the proportion of EU workers in the hospitality sector is at its lowest level since 2016 due to the “potent combination” of Brexit and the Covid-19 pandemic,

South west-based operator and brewer St Austell has temporarily decreased its food service hours and opening hours in some of its managed sites, in a bid to tackle the current recruitment crisis.

Lord has been outspoken about the way the Government has treated the sector and has even took legal action over the indoor opening date for hospitality.