Welcome to the Presidents report for July. The sun is shining, and temperatures are soaring. One thing for sure is that this beautiful weather certainly brings a smile on people faces although the change from spring into summer for me brings some uncertainty. The summer encourages festivals, concerts and events country wide which unless you are a part of it you may find numbers dwindle. I notice within my own business there is a shift in demographic. My locals seem to vanish on foreign holidays, many host family BBQs and dinner parties and the big supermarkets thrive. We rely on our tourist numbers to keep us busy until September and then our local market reappears.
Paschal Donohoe delivered his Summer Economic Statement in June and there was no indication of a reduction in the VAT. A press release from MerrionStreet.ie indicated these amazing stats that tourism numbers are up 5% in the first quarter of 2019. These stats may be correct but when we look deeper into the report, we will see that bed nights are down a staggering 403k nights. Expenditure is down €32 million euro and 11 million of that is from UK visits and cross border tourism. It is kind of like a bunch of people sitting in your restaurant splitting a starter. Sharing a glass of wine and bringing their own sandwiches. We have the visitors, but they are not spending. Feedback from our members is that there has been a significant drop in customer numbers and spend is down. Reflecting on the real figures I think it is fair to say that Brexit uncertainty has seriously unsteadied the ship. I believe there are two budgets prepared; one in the event of a no deal and the other for a softer Brexit. A VAT reduction must be back on the table as we have lost our competitive edge and we are starting to feel the pinch.
I have read numerous articles on social media and national newspapers regarding Hospitality staff being under paid and over worked, in my opinion this is not the case. There is such a demand for hospitality staff that they do not have to tolerate malpractice from any employer. There is a witch hunt at present across many media channels and public perception of hospitality employers is quite negative. There are many other industries that seem to get away with some of the accusations that we face daily. I think that within every industry there is going to be a certain amount of staff that are paid a lower wage for the jobs they do. Demand for skillset determines the rate of pay. If chefs were in abundance it would be a case that the average gross wage would reduce for that position. It is the same situation across a range of professions, it is simple economics. The vast majority of employers want to ensure that their staff earn good salaries. In order to enable employers to raise wages in our already labour-intensive industry, our focus must be reducing the external and unnecessary costs such as extortionate insurance premiums and council rates. We set the bar as a nation when it comes to customer service. We have a unique friendly and heart-warming approach to customer service that is second to none. In order to maintain these levels of service that are currently renowned internationally and offer that “céad míle fáilte” it is vital that we focus on reducing these additional business costs to maintain wage growth responsibly within the sector.
I strongly believe it is our obligation as employers to provide equal opportunity to all our staff. We must provide training courses for our staff to afford them the opportunity to grow within a business and hopefully they will reap the rewards in the form of a higher wage. People may say training can be a huge cost to a business, in my opinion it is an investment. The Restaurant and Hospitality Skillnet programmes have provided some fantastic courses. I have completed some of these courses and I would highly recommend Skillnet as a great way of upskilling your work force.
Industry are deeply unsatisfied with the current financial setup of the new apprenticeship programmes, with excessive costs falling at the feet of employers. The Association continues to lobby for funding for new culinary apprenticeships and we will also be lobbying with vigour to ensure that the Female Apprentice bursary is reinstated and that all apprenticeships are treated equally. We need a solution that works for both employer and student to make this programme a success.
I hope that all our members have a fantastic summer. Don’t forget to take time out and enjoy some of the weather on offer. It cannot be all work and no play.
Mark Mc Gowan