As rail workers go on strike over pay and working conditions, the hospitality industry faces an additional formidable obstacle to its post-pandemic recovery.

The hospitality sector is still struggling to recover from the COVID-19 pandemic, and this week’s rail and tube strikes could cost the industry up to £540 million.

The industry association UK Hospitality anticipates a 20 percent decline in revenue compared to a typical week in June.

CEO Kate Nicholls stated on Sky’s Ian King Live that the industry is extremely fragile and cannot withstand this type of economic shock.

This will push several businesses closer to the edge of viability.

Ms. Nicholls remarked that venues in town and city centers were already suffering from the growing trend of telecommuting, which is discouraging many commuters from attending.

In light of the likelihood that train and tube services will be severely impacted by three days of rail strikes this week, the influx of visitors and tourists will further harm financial statements.

She stated that these establishments had faced the “slowest and longest recovery period,” adding, “They have not yet returned to pre-COVID volume or revenue levels”.

“The ideal storm” for hospitality companies.

“They are currently experiencing another dip, the loss of a portion of a week’s sales, at a time when they can ill afford it.

One in five of our establishments is still not profitable, and one in three has no cash reserves.

She stated, “I believe (hospitality businesses) are facing a perfect storm – a tsunami of inflationary cost pressures, soaring energy bills, soaring food bills, difficulty in sourcing staff, and then the cost-of-living squeeze, which is already causing a decline in consumer spending and foot traffic.”

“These would be the frosting on the cake in the event of a prolonged summer of uncertain strike action, which is so detrimental to consumer confidence.”

During the COVID-19 epidemic, the hospitality industry was among the most strictly regulated; pubs and restaurants, for example, were subject to frequently-changing laws regarding how many people may be served and where they might be served.

‘Collateral harm’

Ms. Nicholls stated that consumers had postponed events during the epidemic, but that this week clients were canceling and not rebooking due to travel anxiety.

In addition, she referred to hospitality employees as “collateral damage” during the strikes.

Most of them cannot work from home due to the nature of their jobs; therefore, either their business shutters and they lose work and cash, or their business remains open and they must traverse the strike-depleted travel network.

Richard Burge, the chief executive officer of the London Chamber of Commerce and Industry, expressed alarm about the effects of what may be a protracted series of strikes.

A week lost every month for the foreseeable future will cause incredible short- and long-term harm to the economy and the United Kingdom’s reputation as an attractive investment location.

James Hardiman, the senior analyst at the British Retail Consortium, stated, “It should come as no surprise that the imminent rail strikes will be detrimental to retail, as they will reduce commuter and customer traffic.

UK footfall is already below pre-pandemic levels, and this will only hinder merchants’ efforts to get customers back into stores.