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04 Jul 2017

BHA calls for government support after study suggests hospitality sector could create 500,000 jobs in next five years

Ufi Ibrahim, chief executive of the British Hospitality Association (BHA), has called on the government to support the sector by cutting tourism VAT and helping to reduce its reliance on EU workers.

Ibrahim’s comments came following the publication of research suggesting that more than 500,0000 new jobs could be created in hospitality in the next five years.

Conducted by the BHA’s economics adviser Ignite V1 and split into two separate reports, the research said that labour productivity is growing at more than double the rate of the overall British economy.

But despite the positive outlook presented by the study, Ibrahim said more needed to be done by the government around tourism VAT and the industry’s dependence on EU workers – particularly with Brexit on the horizon.

Cutting tourism VAT has been mooted by the BHA for some time. According to the organisation, British hospitality organisations spend up to three times more VAT than French, German and Italian counterparts.

As a result, businesses struggle and employ few members of staff. If VAT was slashed, said the BHA, hospitality businesses could entice more people with lower prices, and hire more staff as a result.

She said: “We are the front door to the UK and are fundamental to ensuring the UK remains open for business. With the right strategic support from government, economic stability and access to labour we believe that hospitality and tourism can continue to grow and become a career of choice for more and more people.”

The research also said that hospitality and tourism is the country’s fourth-largest industry, employing 4.6 million people directly and indirectly, accounting for just under one in every five jobs.

Last year hospitality and tourism provided £161bn to the total economy, with £15bn in exports and £38bn in direct tax receipts. According to the research, the tourism and hospitality sector ranks as a top six employer in every region of the UK.

To view The Economic Contribution of the UK Hospitality Industry report, click here.

To view the UK Hospitality Industry Productivity report, click here.

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