New analysis predicts fewer jobs in drinks and hospitality industry in the South-West next year

NEW analysis has found that there will be 6,730 fewer jobs in the drinks and hospitality industry in the South-West region in 2022 as the impact of the pandemic continues.

Despite the predicted economic recovery, the impact will be significant with 40,000 fewer jobs in the industry overall nationwide.

In counties Cork and Kerry, DIGI estimates almost 6,730 fewer jobs including 2,140 among the 15-24-year-olds.

A total of 30,100 people are employed in the drinks and hospitality industry in the South West.

This is despite the broader economy’s ongoing recovery as the country approaches full vaccination.

New Drinks Industry Group of Ireland (DIGI) analysis warns of two-tier recovery in 2022, with hospitality facing major post-Covid challenges.

In response, DIGI has called for the Government to reduce Ireland’s excise tax rate, which is the second-highest overall in Europe, by 7.5% in October’s Budget.

"Ireland’s high rate of excise, which represents a significant cost, is forcing drinks and hospitality businesses to make growth-limiting sacrifices,’ said Liam Reid, Chair of DIGI and Corporate Relations Director at Diageo Ireland.

"At such a precarious time for the industry, every euro matters. 

"Money taken by the Government in excise tax is money that could be spent by pubs, hotels, and restaurants on recovery and investment."

"A 7.5% reduction in excise tax would have an immediate impact and mean more money for businesses to weather what is likely to be a difficult year and, potentially, maintain current staffing levels, hire new staff, invest in premises, and improve product and service offerings to the benefit of domestic and international consumers. 

"Crucially, it will greatly support the industry to maintain the predicted 140,000 jobs,” he added.

DIGI analysis of a DCU economist report suggests weakened tourism demand will impact employment.

The report showed the accommodation and food service sector, which includes most drinks and hospitality businesses, employed almost 180,000 people in the last quarter of 2019.

However, DIGI predicts that the likely substitution of some staycation demand with overseas sun holidays, some element of consumer reluctance, and the overall weaker national and international demand for travel and tourism which in Ireland heavily involves drinks and hospitality businesses means some pubs, restaurants, and hotels will not return to their pre-pandemic employment levels in 2022.

DIGI believes that it should be the Government and industry’s ‘collective goal’ to return to the Q4 2019 total of 180,000 drinks and hospitality jobs ‘as quickly as possible’ in 2022.

"Only by making it easier for the drinks and hospitality industry to do business can Ireland avoid a two-tier recovery, where work-from-home multinationals and professional services companies emerge from the pandemic relatively unscathed, even better off, and the most important domestic industries are left struggling," said Mr Reid.