Northern Ireland’s hospitality sector will suffer significant damage 'unless government support lifts the boot off our necks'

​​More than a quarter of hospitality businesses in Northern Ireland are now operating at a loss, research has indicated.

Following the implementation of extra costs which hit the sector in April, a significant number of pubs, bars, restaurants and hotels are described as now losing money and being at risk of failure.

A new survey of hospitality operators across Northern Ireland found that increases to employer national insurance contributions (NIC) and above-inflation wage increases on hospitality businesses have left 27% of operators saying that they are now operating at a loss, and 20% breaking even.

Just 6% of respondents said that they have made a greater profit at this stage in 2025 than in 2024, according to the research which was undertaken last month by industry bodies.

Undertaken last month (May) by industry bodies, Hospitality Ulster, UKHospitality, The British Institute of Innkeeping, and the British Beer & Pub Association, the survey is the first indication of the devastating effects of the changes that hit Northern Ireland hospitality businesses in April.

It found that 45% of respondents had cancelled investment in preparation for the cost increases, with 35% cancelling investment.

Meanwhile 49% of operators reduced the number of staff employed in anticipation of the cost increases and 33% have done so since April.

Some 51% of respondents stated that their workforce has decreased in the last 12 months, with just 9% reporting an increase.

Just 22% of operators were found to feel optimistic about their trading prospects over the next 12 months, with only 2% stating that they are very optimistic.

Some 49% stated that they are pessimistic regarding the next 12 months, 20% of them being very pessimistic, and 33% of operators indicated they are unsure if their business is at risk of failure in the next 12 months.

Operators are demanding action from both the UK government and the Stormont Executive in order that the sector can thrive and play its full part in economic growth, job creation and high street revival, calling for a reversal to employer NIC changes, a VAT reduction for hospitality, and expedited delivery of lower business rate multipliers.

Colin Neill, chief executive of Hospitality Ulster, urged Stormont to act urgently: "The results of this survey are further proof to what Hospitality Ulster has been warning of for a long time: that the cost of operating is simply too much for Northern Ireland's hospitality sector, which will suffer significant damage unless government support lifts the boot off our necks.

"How does the NI Executive expect to deliver their programme for government plan to double tourism in the next 10 years without the policies in place to deliver it?

"Put simply, hospitality accounts for four out of every five jobs in tourism and takes two thirds of the tourism spend. You can't double tourism whilst you allow the hospitality sector to fail.

“Hospitality is worth £2 billion annually to the Northern Ireland economy; it accounts for 72,000 jobs and is the fourth largest private sector employer. Jobs are being lost, livelihoods under threat, communities set to lose precious assets, and consumers are experiencing price rises when wallets are already feeling the pinch. All of this will cause significant damage to both the local economy and local communities.

“The UK Government and Stormont Executive must act urgently. Our survey tells us that the most urgent issues for operators here are a VAT reduction for hospitality, the reversal of the Employer National Insurance contributions, and the alignment of business/non-domestic rates in devolved nations to match incoming reforms in England. In return for these supports, the hospitality industry can return to investment, job creation, and growth in communities. Without them, these surveys will grow more pessimistic, more jobs will be lost, and the local economy will be further weakened.”