More than three quarters of hospitality business owners believe they need to grow their companies first before they can look to hire new staff, a survey has shown.
According to The Barclays Job Creation Survey 2012, the number of companies in the hospitality and leisure sector who expect to create jobs over the next 12 months has dropped to 55 per cent this year from 57 per cent last year.
When asked whether job creation would generate sales or sales growth would lead to job creation, 77 per cent of business owners said the latter would need to come first, indicating that the majority of businesses currently don't have the cash available to recruit more staff.
Lack of Government help
Last week, in response to The Budget , Moshi Moshi Brighton managing director Karl Jones said he wanted to recruit more staff for his restaurant, but until the Government cut VAT for hospitality and allowed the business to grow he wouldn't be able to.
"Independents have been finding it really tough, but when VAT was cut to 15 per cent, suddenly everyone was able to pay their bills and they had enough to be able to employ more staff," he told BigHospitality.
It is not just VAT where hospitality businesses feel let down by the Government. According to 89 per cent of businesses responding to the Barclay's survey, Government initiatives to foster job creation, such as increasing the number of apprenticeships, have come to nothing so far.
Small business growth
In all, Barclays surveyed 670 businesses across a range of sectors for its annual survey. Of those responding, it was small business owners who said they were more confident about creating jobs this year than last year. Across all sectors, 51 per cent of small business owners said they would create jobs this year compared with 41 per cent of them last year.
Larger companies with turnover of more than £500m were less confident than last year, but nevertheless, 70 per cent of them said they would be creating jobs in 2012.
Of those hospitality and leisure businesses planning on creating jobs in the next 12 months, 85 per cent plan to create unskilled jobs, 79 per cent plan on creating middle management/skilled labour jobs, and 38 per cent expect to create senior management positions.