Whitbread, the British parent company of Premier Inn, could remove 6,000 of its employees as its hotels continue to see low demand even despite resuming operations in summer.
The parent company of Premier Inn said that it will axe about 6,000 employees across its business operations. The British hotel and restaurant firm Whitbread blames the low demand, likely brought about by the health crisis.
Down in Sales
This week, Whitbread said that total sales in the UK remain 40 percent lower than the same period last year. TThe figures remain low, despite a boost in bookings in the summer, the Financial Times reported.
Although most of its hotel in the UK has already opened, Whitbread still saw a drop in year-over-year sales. The three months until August had sales 75 percent less than 2019.
According to Whitbread chief executive Alison Brittain, they expected a lower level of demand since the beginning of the pandemic.
Significant Job Reduction and Layoffs
With the low sales, the company decided to reduce its workforce, which could shrink by 18 percent. Moreover, Whitbread expects a large portion of the job cuts would be voluntary, Reuters said.
The owner of Britain's biggest hotel chain unveiled plans to slash up to 6,000 jobs just days before the UK government begins enforcing new restrictions https://t.co/BhlFaludbs
— CNN Business (@CNNBusiness) September 22, 2020
Specifically, the company said a huge chunk of the layoffs will affect their Premier Inn budget hotel chain. It accounts for 4,500 of the job cuts. Meanwhile, 1,500 of the job releases will affect the company’s Beefeater and Brewers Fayre restaurant chains, per The Guardian news report.
A Suffering Industry
Moreover, the hotel industry has been severely affected by the pandemic. It comes as government lockdowns and restrictions forced people to stay at home or travel places. Additionally, establishments like hotels likewise saw shutdown of operations.
Brittain said that she expects the industry to remain seeing lower demand. She noted that things restricted in the pandemic directly affect them, such as closures and social distancing measures.
Also, the government scheme that helps businesses amid pandemic will expire at the end of October.