Live from Brussels – Issue 105
Welcome back to our ‘Live from Brussels’ newsletter! I hope that in the last weeks you had a chance to make the most of the sunny weather and recharge before another exciting year.
This summer season brought a wave of cautious optimism to the hospitality industry. European countries gradually lifted the most severe restrictions, and businesses in the sector could reopen and welcome guests back in all safety. According to a recent survey conducted among HOTREC members, hotels, restaurants and bars performed well, with good average occupancy rates.
Despite these encouraging data and news of increased indexed turnover and growth rates, it is clear that it will be a long time before the impact of Covid-19 is behind us. 60% of HOTREC members believe that significant disruptions will last until at least 2023. 23% of them, instead, anticipate a full recovery by 2024 or later.
As I recently remarked on the occasion of the Bled Strategic Forum 2021, I tend to agree with this more pessimistic forecast. The epidemiological situation is still uncertain, and many hospitality businesses continue to be in survival mode – with the extreme circumstances of late-night entertainment establishments, most of which have been closed since spring 2020. We are not out of the woods yet.
The truth is: reopening is no recovery, and a couple of months back in business will not make up for the impact of over one year of closures and revenue loss. Establishments are still struggling with short term debt and chronic staff and supply shortage. The severe staffing crisis, in particular – while far from being a ‘recent’ problem – has gotten more critical after the pandemic and since digital and sustainable skills are increasingly in demand. 83% of our members perceived it as the number one challenge European hospitality faced over the summer, and 67% of them believe it will be continuing to pose a threat to the sector’s wellbeing.
Cashflow management and extending the government support schemes were also in the top three most urgent short term issues highlighted by our members. Indeed, hospitality businesses have all the potential to continue being viable, ready to invest in sustainability and bring value to the entire European economy, society and culture, but will only be in a position to do so if backed up by extended funding and support schemes until their full recovery. In this issue, we had the pleasure to discuss this and more with MEP Elena Kountoura, whom I sincerely thank for her precious contribution and insight.
To conclude, today’s State of the Union address wrapped up a year of great efforts and outlined the next steps towards the EU recovery and beyond. HOTREC is looking forward to further collaborating with the EU Institutions to achieve the ambitious goals presented by President Von der Leyen and lead the way towards a more resilient, digital, and greener industry.
We hope you will enjoy our newsletter.