Business News Round Up (05/12/2022)
UK hotel trading performance in 2022 exceeds expectations but the pace of recovery is set to slow in light of the economic downturn
The UK hotel market has continued in its recovery, delivering a strong trading performance. Domestic leisure demand fuelled the early recovery, but this has been supported by robust demand for business travel as well as flexible working trends generating new sources of demand. This comes despite continued challenging market conditions including accelerating costs causing profit margins to decline, according to the latest UK Hotel Trading Performance Review 2022 by leading global property adviser Knight Frank, in partnership with HotStats. Knight Frank’s latest comprehensive review of the UK’s hotel trading performance provides a unique and detailed review of hotel revenues, costs, and profitability. The trading performance of the UK hotel sector has improved significantly in 2022, with London showing a remarkable rebound from the pandemic over the past seven months. Occupancy rates in the capital have recorded 70% occupancy for the seven-month period to the end of October 22. Fuelled by strong demand across multiple segments, despite international visitor arrivals remaining lower than pre-pandemic, the ability to drive rates within a high inflationary environment has resulted in ADRsurging ahead by 22% when compared to 2019 prices, and by 2.8% in real terms. The Regional UK hotel market now exceeds its RevPAR performance by 3.5% and London by 2.4%.
https://www.hospitalitynet.org/news/4113848.html
Scottish industry ‘upbeat’ despite challenges
Scotland’s industrial companies have delivered a “surprisingly upbeat picture” as they posted a seventh consecutive quarter of positive order intake and output volume. Trade body Scottish Engineering said order intake for the fourth quarter remained positive albeit at a slightly reduced level than recent periods. Output volume also remained positive from the last quarter at the same rate of increase. “Optimism within the industry remains positive in most sectors notwithstanding the challenges of increasing prices, most notably the increase in energy prices,” it said. Forecasts remain positive for all company sizes with a forecast 20% increase in orders driven by UK business, and output volume matching this. Export remains a concern as this shows flat quarter on quarter despite domestic growth. Paul Sheerin, chief executive, admitted being “puzzled” by the data at such a difficult time, but attributed the positivity to Scotland’s broad mix of high value engineering and manufacturing, demand within the oil and gas sector, its resurgent aerospace and growing space sectors, and a strong share of defence projects. Precision engineering, which has a high energy sector content, reports a 38% increase in order intake, a 50% increase in output volume, and a 50% increase in forecast output volume for the coming three months.
No new year cheer for UK economy with productivity and business investment weakening – CBI Economic Forecast
After a turbulent year both politically and economically, the CBI’s outlook for the economy strikes a sombre tone as we go into 2023. The Prime Minister and Chancellor have stabilized financial markets but must act to boost long-term growth according to the latest CBI economic forecast. Economic growth can only come from increasing productivity and maximising our workforce. When fiscal and monetary policy is tight, Government must use all levers at their disposal to move the UK economy beyond this current trajectory. This includes addressing skill and worker shortages and unlocking business investment through capital allowances and regulatory changes, such as removing the de facto ban on onshore wind, improving mobility to facilitate trade in services and updating the national planning policy framework. With three-quarters of firms facing shortages, we need a joined-up plan that addresses this. This should include co-ordinated action to enable upskilling and automation across businesses to ease pressures, as well as reducing economic inactivity, supported by a more flexible immigration system. In addition, Government must act now to boost business investment and when the fiscal environment allows, they should look to introduce a permanent full allowances regime to unlock an extra £50bn in capital investment per year by the end of the decade.
SMEs to reward employees with 120M extra days off this Christmas as cost of living bites
Over half a million UK small and medium-sized enterprises (SMEs) are spreading Christmas cheer among their workforces this year by giving the gift of time, according to the latest quarterly Barclays SME Barometer. One in ten (10 per cent) of the UK’s 5.6 million SME businesses said they’ll be gifting each employee 2.5 extra days leave, on average, meaning that SME staff across the country will receive 120,345,602 days off cumulatively. People working in hospitality and leisure (3.5 days additional holiday) and manufacturing (3 days) will get even more time off. The Barclays research found that 41 per cent of SME employers believe staff activities leading up to the festive season contribute to employee retention. Similarly, nearly a third (30 per cent) of Scottish employees say they are less likely to look for another job if their employer organises activities to reward staff over the Christmas period. In fact, of employers who are seeing an increase in demand for benefits from new employees, more annual leave is one of the top three benefits being requested by existing employees, according to 28 per cent of UK small businesses, behind higher wages (87 per cent) and more flexible working (56 per cent).