‘Some restaurants could close without a long-term solution’

STAFF shortages in the hospitality sector are likely to feed through to higher bills for meals out and could force some restaurants to close.

Kevin Boscher. (30006928)
Kevin Boscher. (30006928)

With labour shortages being an issue locally and further afield, the Guernsey Press asked economics expert Kevin Boscher – chief investment officer at Ravenscroft Group, speaking in a business podcast – about the potential effects.

Asked if there would be wage inflation that could result in higher bills, he said: ‘Yes, I think that’s likely to happen. And I think it will differ, again, from country to country.

‘If we look at our own example, a lot of restaurants and hotels in Guernsey and Jersey are running with seriously reduced staff for all the things we’ve discussed, that mix of Covid and Brexit, and so on.

‘And, as we all know, locals tend not to want to work in the local hospitality industry.

‘So what happens in that instance is either the restaurants or businesses can’t fulfil demand, in which case the choice isn’t there for people. Or they put their prices up, maybe, so people do have to pay higher costs for meals and so on. We’re definitely seeing some of that across many countries, including our own islands, and it is it is a real problem.’

LISTEN TO A FULL INTERVIEW WITH KEVIN BOSCHER ON THE GUERNSEY PRESS BUSINESS PODCAST:

Not only were Brexit and Covid–19 having an impact, he said local rules were potentially making it more difficult to bring in some foreign workers – especially when they were needed at short notice.

The cost of living and a shortage of housing were other local factors.

‘It’s going to be an ongoing problem for restaurants, which is going to manifest itself eventually in some of them having to close unless we can find a longer term solution, or some of them definitely putting up prices on a more permanent basis,’ said Mr Boscher.

Making it easier to bring in overseas workers needed to be considered, not least with the local pool of workers shrinking because of an ageing population.

‘Longer term, we may have to face up to the fact that workers in previously lower paid sectors should be paid more, basically, to help compete.’

That could be accommodated by businesses potentially through higher productivity, said Mr Boscher, raising prices or taking a hit on their margins.

Bringing more people into the labour market was another option, which could in the short term mean students or older people doing part-time work.

‘Any of the local labour force that we can try and encourage back into working in sectors that are short, such as hospitality, would be a welcome thing. Longer term, we need to think carefully about more vocational type of training. Let’s try and make hospitality a more attractive industry, a better reputation industry for young people to go into from school or from further education.

‘If the industry is having to pay higher wages to get the staff, that’s going to help make it more attractive for younger workers to go into it.

‘So I think longer term the things we have to do [are] around training, vacation, wages, and all those things to attract more local people into those industries.’

  • Listen to Kevin Boscher at guernseypress.com/podcasts.

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