Chancellor John Healey will deliver his first Autumn Budget in Parliament on October 28, and Greater Manchester's pubs, restaurants and bars are watching closely. The hospitality industry, the UK's third largest employer, supports roughly 3.5 million jobs and accounts for about 10 percent of total UK employment, with a significant share of youth and entry-level work.
But the sector is under severe strain. Rising costs, global instability and unanswered pleas for help around high taxes have left those working in hospitality feeling jaded, with some questioning whether it's time to give up.
Mounting closures and job losses
Earlier this month, British Beer & Pub Association figures showed 295 pubs closed permanently in the first nine months of this year, with 360 closures forecast by the end of the year. The sector's trade body, UKHospitality, says the industry has faced more than £5 billion in additional costs over the past two years, and its budget campaign says nearly 100,000 hospitality jobs have gone over the same period, with young people and part-time workers hit hardest.
Allen Simpson, the chief executive of UKHospitality, has called the staggering number of job losses "an absolutely unprecedented attack" on the sector. Ahead of next week's statement, he and the trade body are calling for a VAT cut in line with Europe to 10 percent; a solution to business rates; changes to the National Insurance Contributions (NICs) by employers; and a rollback on the tourist tax.
Just this week, the trade body and a group of under-30s working in the sector urged the Government to back the sector to create jobs and help solve the NEETs crisis (young people Not in Education, Employment, or Training), and provide the career and development opportunities they themselves have benefitted from.
Business owners share their struggles
Dan Edwards, who has worked in some of Manchester's best hotels and is the man behind Chips No.8 in Prestwich, says costs are going up "across the board", with the war in Iran driving up diesel costs and forcing his suppliers' prices up too. "Fish in particular has gone up because fishing uses boats and a lot of diesel. It's already risen significantly and there seems to be no let up," says Dan. "Although potatoes are reasonable at the moment, we know they will go through the roof due to a long, dry summer and getting hold of quality produce is going to push our costs up - it will take us to the brink."
Ciaran Keaney, landlord and owner of The Angel Pub and Carringtons Wines, has been in the business for 40 years. "Rising costs and the challenges of running a hospitality business have had a significant impact, making it harder for venues to remain viable while continuing to offer customers good value," he notes. "Without meaningful support, we risk losing even more hospitality venues at a time when the cost of living is already making it harder for people to go out."
Wage and tax pressures
The UK government's National Living Wage rose to £12.71 per hour (for workers aged 21 and over) in April 2026, while the voluntary Real Living Wage increased to £14.10 per hour across the UK. This has added an estimated £1.4 billion in labor costs across the UK hospitality sector. Employer National Insurance Contributions also increased in April, with the employer rate rising by 1.2 percentage points, from 13.8 percent to 15 percent.
Rick Scholes, the Managing Director of Grandpa Greene's, the ice cream maker and café business with sites in Diggle and Uppermill, says: "We find wages are out of hand, even going back to 5 or 6 years. Now we're at £12 to 13 for minimum wage before you even start with everything else." He adds: "At Diggle, on key trading days we have more than 20 staff on, and that adds up to such huge numbers. People need opportunities, and businesses need less financial pressure to create those opportunities for young people."
Matt Nellany, co-owner of open-fire restaurant Stow and the Northern Quarter pub and restaurant The Trof, agrees. "We all want to pay our teams the best we can and fairly, but as it rises that impacts significantly on this industry because it is so people-focused," he says. "Bigger chains are going down a more QR code or order-at-the-bar route, so they can save on service, but what you lose is strong hospitality - there is no hospitality without people."
Calls for VAT cut
A #VATsTheProblem petition spearheaded by UKHospitality and led by chef Tom Kerridge was launched this year. It calls for a cut from 20 percent to 10 percent, has more than 400,000 signatures, and has been delivered to Downing Street. Mark Wrigley, the co-owner of Atlas Bar, says that's a clear message to the government from the sector. "I've just paid £51,000 in VAT a few weeks ago, that's a massive amounts of money. Along with NICs which is £60,000 a year just to employ people, we're just going in a downward spiral, and being taxed to death."
Luke Payne, chef and owner of The Pack Horse Hayfield and Almanac, says: "We urgently need VAT relief to help hospitality businesses survive. I run two businesses and am still unable to take a regular wage myself. I have no pension provision and am putting everything I have at risk to keep the businesses going."
Ryan McDermott, who with his wife Megan took over the Ape & Apple pub on John Dalton Street earlier this year, says VAT is "a killer". He adds: "We're talking about aligning ourselves with the rest of Europe where it's closer to 10 percent, but are currently in the same bracket as some of the big companies. Hospitality is a first point of entry and we can't create those jobs because there's so much money going out."
On whether the Chancellor has listened to the calls for lower VAT, Ryan adds: "I'm just hoping they've listened, if they have it will be amazing, but if not, people will hold on for Christmas for that cash, but the shutters coming down from January to March will be faster than we've ever seen - I can't see how anyone can stay open without that help." Dan at Chips No.8 echoes this: "I feel that he's going to do something because he has to, he needs to make a statement. If they cut VAT and bring it in line with Europe, then I think things will be a lot more positive. I'm just hoping for a bit of Northern compassion."
