Festive haircuts slashed and Christmas party carnage
- At the end of December, 50% of businesses classed as ‘other services’ – including hairdressers and beauty salons – said cancellations had increased during the month.
- Among accommodation and food services, 45% said cancellations were up, and in arts, entertainment and recreation it was 27%.
- Those companies with 10-49 staff had the highest percentage seeing more cancellations – at 23%.
The figures were in the most recent wave of the ONS Business Insights survey, published today: Business insights and impact on the UK economy – Office for National Statistics (ons.gov.uk)
The ONS also published: Economic activity and social change in the UK, real-time indicators: 6 January 2022 – Office for National Statistics (ons.gov.uk)
Sarah Coles, senior personal finance analyst, Hargreaves Lansdown:
“The full impact of Christmas party carnage was revealed in figures out today, with almost half of hospitality firms facing a wave of cancellations in December. Meanwhile, festive haircuts were slashed, as half of hairdressers and beauty salons said they faced more cancellations in the run up to Christmas too. The wave of cancellations risks wiping businesses out.
In many cases cancellations were harder to manage than if the sectors had been closed. The lack of certainty made it impossible to plan staff numbers and supplies, which led to an enormous level of waste. Meanwhile, the fact that the sector was officially open meant there was no furlough scheme to fall back on, and the emergency government grants of up to £6,000 were a drop in the ocean for those business hit hard.
Cancellations hit hardest during the festive period, when businesses are usually at their most hectic, but firms will be reeling for months. Many of them rely on Christmas to get them through the leaner months at the start of the year, and even before this wave of cancellations, many of them were running on empty. In the previous wave of the survey, around a fifth of companies said they had cash reserves to last between one and three months, and 7% said they could last less than a month, so some will simply not be able to keep going through the quiet season.
There is the hope that postponed celebrations and makeovers will help. In a separate piece of ONS research out today, the number of people eating at restaurants was 134% of the level a year earlier. However, at the same time last year we were on the cusp of another lockdown, when diners may have already been wary about eating out. And with COVID infections continuing to run rampant, there’s every chance that the wave of cancellations will keep coming and risks wiping businesses out.”
