Hospitality sector facing a 'perfect storm' amid Chancellor's 'rising costs' - London Business News | Londonlovesbusiness.com
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Hospitality sector facing a 'perfect storm' amid Chancellor's 'rising costs' - London Business News | Londonlovesbusiness.com
"Hospitality has always relied on a diverse, global workforce,"
"But the landscape has changed dramatically. Employers are under pressure from every angle - higher wages, stricter visa requirements, and unpredictable demand. Success now depends on how quickly businesses can adapt their workforce strategies."
"Historically, more than 20% of the workforce came from overseas, but new immigration reforms have raised barriers. For instance, over 180 hospitality roles have been removed from visa eligibility. Plus, sponsorship costs for employers have surged, whilst at the same time, wage pressures are mounting. 2026 looks set to be hugely challenging for these people-centre businesses."
The UK hospitality sector contributes over £93 billion annually and faces an estimated 84,000 unfilled positions. Employers are confronting rising wage bills, with the National Living Wage increasing to £12.71/hour from April 2026, adding about £1.4 billion annually to costs. Immigration reforms have removed more than 180 hospitality roles from visa eligibility and raised sponsorship costs, limiting access to overseas labour. Frozen tax thresholds and higher National Insurance contributions further squeeze operators. Many businesses are seeking staff internationally, but tighter visa rules and surging labour costs make effective workforce planning and rapid adaptation essential.
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