The latest NTIA Night Time Economy Market Monitor, produced with NIQ, showed the late-night sector has shrunk by 28.2% since before Covid.
Late-night venues fell by 4.1% in 2025, while the number of late-night bars declined by 4.9% year-on-year. Nightclubs were hardest hit, down more than 35% since 2020.
Despite the sector generating almost £160bn a year and supporting more than 2m jobs, 75,000 roles were cut between 2024 and 2025.
Productivity growth also stalled at 1.5% and real-terms night-time spending remains 10% below 2019 levels.
Higher prices
Meanwhile, higher prices fuelled headline value growth in 2025, rather than increased footfall or sales volumes. Food and drink trade fell by 6%, leaving operators squeezed between falling demand and rising labour, energy and compliance costs.
Consumers are still socialising in late-night venues but adapting their behaviour in response to unreliable late-night transport, increased safety concerns, higher travel and living costs and declining confidence in town and city centres after dark, according to the report.
Evening economy recorded modest growth of 0.9%, with experiential venues such as cocktail, craft and themed bars expanding. However, the traditional late-night market continued to contract.
The trade body argued venues cannot simply adjust by opening earlier, as their cultural and economic value lies in operating late.
However, the report showed areas investing in transport and safety saw better results, with central London recording growth of 2.7% in late-night venues.
The NTIA said the data demonstrated a “systemic failure” as businesses continue to face tax and regulatory burdens.
Policy failure
It called for an emergency support package for the sector, including a VAT reduction for hospitality and night-time businesses, reform of licensing and business rates and action on rising operating costs to protect the UK’s night-time economy.
NTIA CEO Michael Kill said: “This is what happens when a £160bn sector is loaded with rising costs and then left to absorb shock after shock without support. Losing over 28% of late-night venues is not market evolution, it is policy failure.
“If the Government wants growth, jobs and a competitive visitor economy, it must act now. That means an urgent economic support package, including a VAT reduction for hospitality and night-time businesses, before more venues and livelihoods are lost.”
NIQ senior insight consultant Reuben Pullan added: “2025 has proven to be another tough year for the hospitality sector, and even more so the night time economy.
“While pockets of success demonstrate an innovative, adaptable sector, the rising cost of doing business is applying an indiscriminate pressure on the industry.
“These operational squeezes, and shortfalls in late night infrastructure, are further complications when many venues are trying to navigate a crucial moment of evolution.”
