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Flash Survey: UK Businesses Face Economic Strain, Falling Confidence, and Survival Fears says UK Trade Bodies 09 May 2025

 
Industry Flash Poll Says 64.4% of Hospitality, night time economy and events businesses see a reduction in VAT as a primary ask. A new survey of over 250 businesses across the events, night-time economy, and hospitality sectors has laid bare a harsh truth: the very industries that breathe life into our towns and cities are on the brink—and the Government is nowhere to be seen.
"We are being abandoned."

That’s the overwhelming sentiment echoing from restaurants, pubs, bars, festivals, and performing arts venues across the UK. These aren’t faceless corporations—they’re small and medium-sized enterprises that employ millions, support artists, create vital gathering spaces, and give our towns and cities their cultural identity.

More than half (51.5%) of respondents operate bricks-and-mortar venues—cornerstones of local communities. A further 33.7% run event-based operations, from live gigs to festivals, that fuel creativity and local economies.

Today, 50% of these businesses say they face a bleak future. Almost half are anticipating job losses. The reasons are stark:
  • 88% cite unsustainable cost increases
  • 78% report falling footfall
  • 58% blame a lack of Government support for their downward trajectory
One venue owner captured the struggle perfectly: “Huge hikes in utilities (6–50%), the effect of Employers’ NI changes, and inflation are about to hit us hard—and we simply can't pass this all onto ticket prices.”

 

The Sector is Being Bled Dry
From dusk till dawn, this sector powers the UK’s cultural heartbeat. 76% of surveyed businesses trade in the evening, 62% through the night, and over a third continue into the early hours. But despite their contributions—economic, social, and communal—they’re being left behind.
While bills skyrocket and customer numbers dwindle, Government support has been shrinking. Many feel invisible—ignored by policymakers who continue to treat night-time culture as expendable. “We can’t raise prices forever,” said one business owner.
Still, 55% expect they’ll have no choice but to increase prices again this year, despite the risk of deterring even more customers.
The warning signs are clear: nearly 40% fear permanent closure. One operator said it plainly: “I support hospitality businesses and can see there will be many closures without support for the sector.”

 

Michael Kill, NTIA CEO: “There is just deafening silence from Government”
“This is a final warning bell. The data confirms what we’ve been hearing from members for months—venues and event operators are reaching breaking point. These businesses have shown unbelievable resilience, but resilience is not infinite. The lack of Government engagement is pushing an entire cultural ecosystem closer to collapse. We need meaningful intervention, now—not after the lights have gone out.”

 

A Sector Losing Confidence, But Not Its Resolve
Though the landscape is gloomy, there’s still resilience among these businesses.
“Just a state of mind! If I'm not positive, then why bother continuing? Although audits show a fall of 20% from the previous two years and signs show this trend is very likely to continue.”

 

Others, while facing serious challenges, are working tirelessly to adapt: “I remain positive but the challenges are ever-increasing. We’ve had to make difficult decisions to survive. Some have worked, others haven’t—but it’s a fight.”
Yet it's clear the cracks are growing wider: “Gloomy landscape, changing cultures, rising artist fees—yet declining customer spend.”

 

Economic Pressures Keep Mounting
Respondents are clear that challenges go beyond just rising costs: “Three other reasons spring to mind. The pandemic taught people how to have a good time at home. Social media has skewed expectations for live performances—especially comedy. And the cost-of-living crisis is still very much alive and kicking.”
While customer habits have changed too: “Less advance ticket buying means some festivals and events are collapsing entirely, rather than risk waiting for late sales that may never come.”

“We’re seeing more people struggling to get transport to and from nights out due to government restrictions on city centre access.”

 

What the Sector is Urgently Demanding
These aren’t radical requests. They’re survival strategies:
  • A VAT reduction across hospitality and events (64.4%)
  • Targeted financial relief and business rates reform
  • Energy cost support and NIC reform
  • Investment in marketing, infrastructure, and regulatory clarity
One respondent put it bluntly: “Reversal of many policies and stealth taxes that are about to hit our customers’ spending power.”
And for those running small, independent businesses, the call for help is more urgent than ever: “More financial help—like low-interest loans—to help grassroots and independent businesses deliver more for their communities.”

 

Even outside of fiscal support, they face unfair systems: “Utility brokers and energy companies unfairly penalise us by SIC code. The market for late-night energy is reduced to just a couple of suppliers who price at risk and often force us into deemed contracts at 400% higher than commercial rates.”

 

A Call to the Chancellor: Listen Before It’s Too Late
These businesses aren’t just stats on a spreadsheet—they’re people. Artists, chefs, bartenders, technicians, creatives. They host community events, mentor young talent, and support local governance—even as their own future hangs by a thread.
“If the Chancellor fails to act decisively, the collapse of the UK’s events and night-time economy won’t just be a loss of income—it will be a cultural, communal, and human tragedy.”
The message is loud and clear: We are not invisible. We will not be ignored. We need your support—before the lights go out for good.

 

Sacha Lord, Chair of the Night Time Industries Association said:
“These latest figures show over 40% of venues are now looking to make job cuts - on top of the redundancies already made as we approached the new tax year. This level of loss is unsustainable and with the majority of the sector’s workforce aged under 25, is only exacerbating the cost of living crisis for young people across the country.” 
 
Alan Fox, NCASS CEO. “Independent hospitality businesses across the UK are under immense pressure from an unrelenting rise in costs. From the outside, things might look positive—queues at food stalls, busy bars, cafés and restaurants. But behind the scenes, the reality is far more troubling.
 
Food and energy costs have surged and now wage increases, higher national insurance contributions and soaring rents are compounding the problem. At the same time, consumer spending is down as people tighten their belts in an ongoing challenging economy. For many, the cost of staying open is becoming unsustainable.
 
But an independent hospitality business is never just a restaurant, cafe or a bar. It’s a dedicated team of skilled, passionate people. It’s a fixture of the local high street. It brings vibrancy, identity, and a sense of belonging to the communities it serves. These businesses offer more than meals or drinks, they create culture and connection.
 
In spite of the challenges, over 400,000 small and micro hospitality businesses are still operating. That’s a powerful display of resilience but resilience alone can’t carry them through. The government must do more to understand the challenges and the needs of independent hospitality businesses that make our villages, towns and cities what they are today.  With the right support, these businesses can not only survive these challenging times but continue to thrive long into the future and enrich our communities for years to come.”
 
Stephen Montgomery, Director of the Scottish Hospitality Group said:
“The UK Government needs to act now if they want to stem the failing of hospitality businesses, and a reduction in VAT is the most direct lever to pull to help save all hospitality businesses across the UK. We have already seen from previous interventions in the Republic of Ireland, where reducing the VAT for hospitality benefited not just the Government tax take, but also led to more employment, more business openings, and less business failures. This is why after its positive impact previously,  the Republic of Ireland has again dropped VAT to 9%, whilst Germany has also dropped VAT to 7%. The UK Treasury do the right thing by reducing VAT now.”

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THE HEADLINES

13 Jun 2025

  • Data (Use and Access) Bill passes without amendment (see News)

  • Has the time finally come for metered music experiences? (see Opinion)

12 Jun 2025

  • What moves the needle for artists in 2025? (see Features)

  • Tributes pour in for Brian Wilson (see News, Features, Showbiz&News)

  • These touts made millions - and claimed staff at big ticketing firms helped (see Features)

11 Jun 2025

  • Billboard names its Independent Power Players (see Features)

10 Jun 2025

  • New report highlights emergence of a two-tier music streaming market favouring scale over diversity and flags need for urgent action (see Reports)

09 Jun 2025

  • Ministers’ silence on threats to our creatives is bewildering (see News)

  • Sony Music Publishing set to acquire Hipgnosis Songs Group (see Business)

  • Manchester's Co-op Live to host the BRIT Awards (see News)

06 Jun 2025

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  • BPI CEO addressed the SXSW London conference (see News)

05 Jun 2025

  • Elton John slams Labour over the AI act (see Opinion)

04 Jun 2025

  • Jim King's 30-year reign (see Features)

  • TikTok launches TikTok for Artists (see Digital)

  • Culture secretary Lisa Nandy talks AI policies and regulation (see News)

03 Jun 2025

  • A study from ICMP on music publishing revenues shows that digital now dominates (see Reports)

02 Jun 2025

  • Majors in talks to license music to AI firms Udio, Suno (see News)

  • Taylor Swift has bought back rights to her master recordings, a win for her but also a potentially major win for the industry (see Features)

  • UK music business power players: 2025 list revealed (see Reports)