The Chancellor’s tax and wage increases from April could force 6% of Scotland’s pubs, restaurants and hotels to close.

A survey by the Scottish Licensed Trade Association (SLTA) reveals that many will reduce their opening hours and cut back on staffing, while others are considering calling it a day.

Colin Wilkinson, SLTA managing director, said: “Christmas and New Year was a difficult
period for our industry with a universal theme of visitors spending less time in outlets and
spending less on food and drink.

‘‘We also continue to face rising costs and staff shortages – 38% of noutlets told us that staff availability is impacting upon opening hours, up from 23% in the summer.

“Regarding the pending changes to NI contributions, 75% of outlets expect new employers’ NI costs to impact on their staffing levels. This will make it even more difficult for businesses to open their full operating hours, remain competitive and get more people into our venues.

“We are also facing the harsh reality that 6% of respondents are seriously considering
closure.”

Mr Wilkinson said the SLTA supports the Scottish government’s call for the introduction of a Scottish hospitality workers’ visa, which could help to alleviate staff shortages.

Some hospitality groups have said they will have no other choice than to raise prices, with Signature group admitting it is a gamble with customers facing their own cost pressures.

Signature’s venues include the Huxley, Copper Blossom and Cold Town House in Edinburgh, and The Spiritualist in Aberdeen and Glasgow.

Key survey findings:
 59% of outlets were down at Xmas 2024/25 versus last year. However, for the total calendar year this fell to 49%. 
 Visitors were spending less time and less money in venues, but there was an increase
in low-alcohol products.
 Staff availability challenges are increasing, with 38% of outlets reporting an impact
upon trading, up from 23% in summer 2024.
 Rising rates continue to be a challenge across the sector with 33% of outlets seeing an
increase of 10% or more.
 Cost pressures continue to have an impact with 63% of outlets reporting increases of
over 10%.
 Over 80% of outlets expect the Scottish economy to decline.
 48% of outlets expect to grow or remain stable, while 6% are looking at possible
closure.
 75% of outlets expect new employers’ national insurance costs to impact on their
staffing levels.
 Despite the challenging environment, 58% of outlets expect to be profitable or break
even in 2025.
 Outlets expect to see a continuing shift towards lower-strength products.