Christmas in the hospitality sector: financial pressure greater than ever before
The hospitality sector has been one of the hardest hit by the outbreak of COVID 19. Employees in the sector are facing real financial difficulty after months of reduced wages.
Whilst the furlough scheme has supported employees throughout, an extended period of reduced wages has had a devastating impact.
A tricky Christmas means the winter period is set to challenge the financial lives of UK hospitality workers even further.
Employers in the sector have the power to act now and stop financial uncertainty from having a lasting impact in 2021.
Hospitality sector furloughs staff
As early as April, 8 in 10 workers in the hospitality industry were furloughed (ONS). The furlough scheme meant organisations were able to support their employees throughout. However, it was, for many, a significant reduction in income.
The average monthly household expendable income reduced by around £515 – a 17% reduction (CEBR).
Almost 4 in every 5 hospitality workers said that they were worried that they wouldn’t be able to pay household bills and cover living costs as a result (Unite Hospitality).
A second lockdown for the hospitality sector
As we moved out of the first lockdown, there were high hopes for a steep recovery. A second lockdown could deliver a real blow to an already fragile industry and a fragile financial situation for many workers.
A survey by Compare the market found that 35% of people were concerned about paying bills through a second lockdown. 33% say that they will struggle to look after their families.
Christmas expense and the January blues
Whilst the industry will be opening up in some form or another come the 2nd, this is going to vary.
Research from the food supplier, Bidfood, found that 31% of consumers plan to make Christmas a bit smaller this year. Encouragingly, 1 in 5 say they are planning to spend more than they have been.
Those that normally rely on the busier Christmas period to boost their finances will likely miss out this year, adding to an already strained financial situation.
What can be done?
It’s not all doom and gloom. As an employer, you’re in the perfect position to be a financial lifeline for your staff and make the Christmas period a better one.
Earned Wage Access
As we’ve seen throughout this outbreak, increased liquidity is vital to helping us survive. That doesn’t stop when it comes to wages.
Earned wage access or earned salary access schemes provide employees with access to their wages as they’re earned.
Earned wage access provides effective liquidity to staff. EWA means that your staff can cover unexpected expenses, manage money better and build towards a more secure financial future.
This increased liquidity has already helped thousands of Wagestream users throughout the lockdown.
86% of users have said that Wagestream has made them feel less stressed throughout the COVID period
67% said Wagestream makes them feel more in control of their finance
46% have avoided using a payday loan throughout the COVID period
As a Fourth payroll customer, you can now activate Wagestream at no extra cost.
It’s quick and simple to activate and means you can start supporting your staff in time for Christmas. To find out more and activate, click here.