Post COVID world – what would the hospitality sector look like?


Blog by Aditi Banerjee, Magic Billion

Consider these statistics[1]:

·        France: In March 2020, lock down measures resultedin the closure of 75,000 restaurants, 3,000 clubs and 40,000cafes, affecting 1 million employees who have been placedunder technical unemployment. These numbers have gone up since.

·        UK: 80% of workers in the hotel and food industries were reportedto be on furlough schemes and about a third of jobs were atrisk in the longer term.

·        USA: 2020 projected to be the worst yearon record for hotel occupancy leading to immense joblosses. Since the beginning of the crisis, nearly 1.6 millionhotel workers have been laid off or furloughed and 3.9million hotel-supported jobs have been lost.

Suffice to say, the impact of coronavirus on the hospitality sector has been staggering.

National governments across the world have been announcing stimulus packages since March 2020. For example, Germanyis giving out a€130billion coronavirus recovery package, on top of a €750 billion rescue package agreed earlier. This includes a €25 billion loan support programme for small firms that have seen their sales drop by more than 60% for June to August – which could potentially be a boost for bars, restaurants, hotels and other hospitality businesses.

While we anticipate “normal” life to get back only post the release of a vaccine (in early 2021 hopefully!), since June/July, the hospitality sector has started to open up with a number of health and safety procedures in place. We experienced these first hand during our recent trip to Cambridge two weekends ago. From the local train to the hotel we stayed at to the gelato store with a line going round the corner, everybody was following social distancing norms, and cleaning up after themselves – basis the UK Government’s guidelines. And there were plenty of domestic tourists – all glad to be out after several months of home quarantining.

                                                                                Local train from London to Cambridge

According to multiple estimates, countries which have strong domestic demand for the hospitality and tourism sector, will revive the quickest. One such country is Germany. Hospitality recruitment is already being planned for 2021 for corporate and leisure travellers, once people are more comfortable traveling post vaccine, and given pent up travel demand! With trade fairs and conventions opening up in the first quarter of 2021, there is a high expectation in the country of the sector picking up quicker than other sectors.

My company, Magic Billion, has already received multiple orders from Industry Associations, Colleges and Employers, for hospitality recruitment and hospitality education degrees in Germany. All of these will entail students/young professionals studying German language in India (till B1/B2 level) and traveling to Germany only between March-August 2021 – a safe bet for all parties involved! But this demand for hospitality recruitment also shows that the country is planning ahead, as should others. What sets Germany apart is exactly this kind of forward thinking, be it in their automobile industry or hospitality and tourism.

                                                                      Punting in River Cam, August 2020


The expectation is: as the global lockdown reduces, people will be less interested in spending money on material possessions and instead are likely to spend on holidays, travel and experiences. 

[1]According to the International Labour Organisation (ILO) report from April 2020


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