Hospitality insolvencies jump by 29% MoM in November 2024
The monthly increase in insolvencies could be an early warning sign, RSM UK said.
Accommodation and food services insolvencies jumped by 29% month-on-month (MoM) to 327 in November 2024 from 253, according to RSM UK.
Insolvencies in the sector also showed a 13% decline to 327 in November 2024, compared to 375 in the same month in 2023.
“The month-on-month rise in insolvencies in November could be an early warning sign of what’s to come for the hospitality industry,” said Saxon Moseley, partner and head of leisure and hospitality at RSM UK.
“The lowering of the threshold for employers’ National Insurance contributions (NIC) is particularly damaging for the sector, given its reliance on part-time and casual workers,” he added.
Moseley also said that although households have record savings, the consumer-driven recovery that many operators anticipate has yet to materialise.
Operators that can weather the challenges of the NIC changes in April will be well-positioned to benefit from the expected uptick in consumer confidence later in the year.
He also added that well-capitalised operators may find growth opportunities and bring efficiency through acquisitions and consolidation.
