Half of nation's pubs at high risk of failure
A new "stress test" of Irish pubs shows that half of them are rated as facing a high risk of failure.
The review of the hospitality sector including pubs, hotels and restaurants, carried out by Business Barometer, shows the situation in the industry could be even worse than feared.
"Our probe into almost 2,500 companies operating in the hospitality sector in Ireland revealed that a large percentage were displaying signs consistent with business failure – amongst the worst affected were Ireland's pubs," Business Barometer said.
Out of 945 pubs surveyed, 49 per cent were at high risk of collapse and a further 20 per cent at medium risk.
Of the 990 restaurants tested, the survey found that 494 were rated as being at a high risk of failure. Another 183 were at medium risk. Hotels did not fare much better with 263 of the 547 tested showing up as high risk and a further 149 a medium risk.
According to the Vintners Federation Ireland (VFI), who carried out separate research, 39 per cent of their publicans have made reductions in staffing levels in the first three months of 2013. Just 8 per cent have increased staffing levels in the same period. In all, 43 per cent have reduced the working hours of existing staff.
Overall, the VFI paints a bleak picture of a trade that was once seen as a licence to print money, with landmark pubs sold for millions during the boom.
Rural Ireland could see another 150 pubs close this year. Six out of 10 publicans outside Dublin say business is slow and turnover down. Last month VFI president Gerry Rafter told publicans at their AGM that 38 jobs are being lost each week in the trade.
"The longer government stalls on the introduction of legislation on the sale of alcohol, the more likely it is that this trend will continue. Minister White and Minister Shortall before him championed a minimum price for alcohol and safer sale and promotion of alcohol, but still we have seen no movement," he said.
Mr Rafter added that 50,000 people rely on the pub for jobs and to support their families. "The drinks industry has lost 6,000 jobs since 2009 and 1,300 pubs have shut their doors since 2005," he added.
He added that publicans can see at first hand the crippling effect on confidence and spending power that austerity has had.
"People either have no money or are afraid to spend and the Government cannot take any more money out of people's already shallow pockets. We are all looking for a chink of light from this administration to boost confidence," he added.