Around 195,000 people working in the UK travel industry have either lost their job or are at risk of losing their job due to the Covid-19 crisis.
The sector employs around 526,000 people across the UK in ordinary times, meaning that more than a third (37 per cent) of all jobs in the sector face being wiped out, according to industry group ABTA.
It’s not just jobs that are bearing the brunt, businesses are on the brink of financial failure, with 57 per cent of SME travel agents said they would not have the cash to survive more than three months based on current trading conditions and available Government support.
The travel industry has taken the biggest economic hit of all sectors impacted by the pandemic, with Office of National Statistics figures showing revenues for travel agents and tour operators have been consistently down between 86 to 90 per cent each month since February of last year.
ABTA’s findings show the immense pressure the travel industry is under after almost 18 months of severe restrictions which have curtailed the sector’s ability to trade.
The industry body is therefore urging the government to deliver a package of tailored financial support to see the industry through to recovery, which includes extending existing furlough and self-employed income support, extending full business rates relief and creating a new sector-specific ‘recovery grants’ regime for travel agents, tour operators and travel management companies.
Mark Tanzer, ABTA’s chief executive, told City A.M. it it is particularly critical that support is extended given that employer furlough contributions are due to rise at the end of the month and business rates relief will be tapered.
“With international travel still largely restricted, travel businesses will not have the money to cover these costs,” the association said in a statement.
The government is expected to review the requirements for international travel on 28 June, and the industry is also awaiting the next review of the traffic light list.
Traffic light system
ABTA called the traffic light system, launched last month to deliver a safe, meaningful, risk-based restart to international travel, “a false start, which has further dented consumer confidence at a critical time.”
“The system is not operating as intended, with overseas travel barely open, and as a result, the industry is on the precipice of losing a second peak summer season – crucial months which represents two-thirds of travel companies’ income,” Tanzer said.
“Travel businesses feel completely abandoned by the government, which has consistently failed to provide adequate support for an industry which has borne the brunt of the economic fallout from the pandemic,” he added.