More than 2,000 jobs are being axed at pub chain Marston’s as curfews and new coronavirus restrictions have hammered trade.
The group said around 2,150 of its pub workers currently on furlough support will be impacted, while it will also launch a further cost-cutting plan by the end of the year.
Marston’s put the blame squarely on the recent nationwide measures to tackle the surge in coronavirus cases, which has seen curfews placed on hospitality venues and the closures of sites not serving food in high-risk areas such as Liverpool.
The UK Government imposed a 10pm curfew on pubs and hospitality venues across England from September 24, but since then Scotland has imposed a raft of further restrictions including closures in some areas and a 6pm curfew elsewhere.
Prime Minister Boris Johnson also on Monday announced the new three-tier lockdown system, which has seen Liverpool subject to measures including the closure of bars, pubs which do not serve meals, gyms, betting shops and casinos.
Marston’s said it has 21 sites in Scotland, of which eight are currently closed, and 18 in the Tier 3 Liverpool region, although the majority of these serve food and are allowed to remain open.
Ralph Findlay, chief executive of Marston’s, said: “The additional restrictions which have been applied across the UK most recently present significant challenges to us and will make business more difficult for a period of time.
“I very much regret that the consequence of this is that the jobs of around 2,150 of our colleagues will be impacted, but it is an inevitable consequence of the limitations placed upon our business.
“We will be looking at our cost base further in the coming weeks.”
Marston’s claimed the new rules “undermine consumer confidence and create uncertainty”.
It said: “The introduction of these further restrictions and guidance affecting pubs is hugely disappointing in view of a lack of clear evidence tying pubs to the recent increase in infection levels, and our own data which suggests that pubs are effective in minimising risks.”
I fear this will just be the tip of the iceberg for hospitality businesses as new restrictions begin to bite, without anything like a sufficient support package to meet overheads, cash flow and proper incentives for employers to keep staff on. https://t.co/adpONM8T4x https://t.co/hr88QJsSWK
— Lucy Powell MP (@LucyMPowell) October 15, 2020
Shadow business minister Lucy Powell warned the Marston’s job cuts will likely be the first of many due to the new restrictions.
She tweeted: “I fear this will just be the tip of the iceberg for hospitality businesses as new restrictions begin to bite, without anything like a sufficient support package to meet overheads, cash flow and proper incentives for employers to keep staff on.”
Details of the job cuts at Marston’s comes as its annual results showed pub sales tumbled 34% to £515 million in the year to October 3, impacted heavily by the lockdown earlier this year.
Since pubs reopened in July, like-for-like pub sales were 10% lower over the 13-week period, helped by the Government’s Eat Out to Help Out meal discount scheme in August.
Brewery sales were 22% lower over the year at £306 million, though sales in retailers and off-licences lifted 23% as pubs were forced to close.
Marston’s announced a deal in May to merge with Carlsberg’s UK arm to form a joint venture worth around £780 million.
The tie-up will create the Carlsberg Marston’s Brewing Company and is set to complete at the end of this month.