Business investment in the hospitality industry fell by 13.7% last year, analysis of latest ONS data by business tax relief specialist Catax reveals1.
Business investment in hotels and restaurants fell £621m in 2020, dropping from £4.6bn in 2019 to £3.9bn.
This means the hospitality sector slightly underperformed the UK industry as a whole in 2020, after all sectors recorded a 10.2% fall last year compared with 20192.
The sector also recorded a big slump in the final quarter of the year. Total business investment in Q4 2020 only reached £898m, which was 22.2% (£256m) down year on year, demonstrating the challenge still facing an industry that continues to be one of the worst affected by the pandemic.
UK GDP shrank considerably last year due to the consequences of the Covid crisis, declining 9.8% compared with 20193 — the worst annual performance on record.
Mark Tighe, CEO of business tax relief consultancy, Catax, commented, “It was a particularly difficult year for the hospitality sector and no surprise that its business investment figures trailed UK industry as a whole.
“However, consumers have a huge nestegg of accidental savings that will make itself felt as Covid restrictions fall away this summer. Hospitality is one of the key sectors primed to benefit strongly from an opening of the floodgates and we expect to see a dramatic improvement in the level of business investment this year.”
(source: Catax, image: pexels )