​Richard Caring: Hospitality faces wave of redundancies once furlough ends

Richard Caring has warned that Boris Johnson’s “weakness and indecision” on reopening restaurants, pubs and cafes will cost more than two million workers their jobs.

In an interview with the Mail on Sunday, the restaurateur and private members’ club mogul Richard Caring, who backs The Ivy Collection, Bill’s and Soho House, warned the Prime Minister he was “killing the country” by failing to outline when hospitality venues could reopen and whether they would have to abide by the two-metre social distancing rule.

Caring said ministers had grossly underestimated the permanent damage being done to Britain’s 26,000 restaurants.

He said thousands of businesses and their employees were in the “eye of a storm”, surviving thanks only to the Government’s taxpayer-funded furlough scheme that pays staff wages, and a pause on rent and business rates tax bills.

As soon as state aid measures are withdrawn, Caring warned, as many as “50 or 60%” of the 4m-strong hospitality workforce could be laid off and restaurants, cafes and bars shuttered for good.

He said the wave of redundancies would be “like a volcano” erupting, with the worst of the pain coming in September and October when the furlough scheme ends.

The intervention by arguably the most influential businessman in the hospitality industry will pile pressure on the Prime Minister to ease two-metre social distancing rules and follow countries such as France, Spain, Italy and Germany in allowing restaurants and pubs to reopen with less onerous restrictions.

Calling for urgent action to avert the looming jobs crisis, Caring said: “The beginning of the lockdown gave us an initial shock.

“Now it’s quite calm because people are furloughed, businesses are not paying staff, they are not paying rent, they are not paying rates and staff don’t have the expense of going to work and the expense of going out.

“So as a restaurateur, you believe you can sit tight and survive, and that’s what everyone’s doing. But the big problem that people shy away from is that we’re in the eye of a storm. ‘The fact is, down the road there’s a volcano that is going to bubble over.

“I don’t think people can see it yet, but everyone in hospitality is beginning to realise they will have to make heavy cuts. ‘This volcano, unless we wake up to it now, it’s going to be horrendous. It’s just going to explode, spewing out unemployed people. The pain and suffering it is going to cause is horrific.

“There are estimates saying we could have up to five million unemployed. It’s not going to be five million – it’s going to be more. I don’t think we’ve seen anything yet. The Government is killing the country right now and the hospitality industry is the frontline disaster.”

Caring urged the Prime Minister to be “brave” and “stand up and be counted”.

Mr Johnson has launched a review of the two-metre rule and indicated that hospitality businesses might be allowed to reopen on July 4.

 

But he has given no concrete assurances and speculation is rife that the PM wants to keep social distancing at two metres until September, when schoolchildren are scheduled to return to classrooms.

“The British people are tough, but they want to have something to hold on to, and we’re not giving them anything at the moment, just ‘maybes’,” Caring said. “They deserve more.”

He believes the Government has failed to grasp the scale of the looming unemployment crisis. Alongside the two million hospitality layoffs, Caring estimates that 25% of those on furlough in other industries will eventually lose their jobs.

He predicts that the cull will push the overall jobless figure for Britain to an astonishing seven million people – equal to about one in five of the working-age population. “The clock is ticking and when furlough ends, that will be it for a lot of businesses,” he said. “Businesses that were not strong in December 2019 will not survive. I think the country is going to wake up to this terrible shock.”

In Europe, Germany, Belgium, Greece, Italy, the Netherlands and Portugal have all allowed restaurants to open with 1.5 metres social distancing. Meanwhile, France, Austria, Denmark, Norway, China, Hong Kong, Lithuania and Singapore require only one metre. Guidelines issued by the World Health Organisation also recommend keeping a distance of one metre.

Caring said: “If they can do it elsewhere, why not here? I get so many calls from people saying when are you going to open the restaurants. My answer is I can’t – there are no regulations, there are no rules, there is no information. We don’t know if we need glass screens between tables. Is it two metres without screens? One and a half with screens? We don’t know. We’re just told it’s under review, under review, under review.”

Caring said “the world has turned on its head five times” since Britain went into lockdown in March to deal with the Covid-19 crisis. He has spent it at his home in London with wife Patricia and their three children, aged one, three and five.

“I’m just so very upset for everyone in this country and I just want everyone to be OK.

“This crisis has changed my way of thinking dramatically. This has been such as tremendous shock to everybody.”

“We as a company were in expansion mode right up until the announcement of Covid back in February,” Caring revealed.

“Now that whole landscape has changed totally and our focus has become being secure and protective.”

He added: “We hadn’t signed any contracts because we were waiting for clarity on Brexit, so we didn’t actually complete any of the expansion. And then Covid hit – so our hesitation really proved to be fortunate.

“I have definitely at this time lost some of the aggression to expand. Now it’s about survival. We are anxious to reach a place of calm.”

Despite his best efforts, Caring said his business empire won’t escape the job cuts forecast for later this year. He warned that ‘value’ restaurant chains such as Bill’s were most at risk of the industry-wide layoffs.

“I’m really upset about losing staff because we have a lot of very good people,” Caring said. “But we have to look at staying in business.

“I’m of no use to our staff if we go out of business, so we have to make cuts.

“I like to think that this will turn itself around to the point where we can bring those people back very soon.”

Caring said nearly all the landlords of his restaurants had been ‘supportive’ during the lockdown, adding: “I strongly recommend that landlords and tenants communicate – they are hand-in-hand in this situation and only by the willingness to be aware of each other’s problems can they make positive progress. They need each other now more than ever before.”

On solving the crisis, he added: “If I was Prime Minister, I would print a lot more money because this devastation is going to last a long time. What are they waiting for? ‘Someone has got to stand up and be counted. Answer questions, have a plan.

“I believe in this country and the courage of the British people. We went through the Blitz and this is the Blitz again, times ten. We could do with a Winston Churchill, but we will come out of it. ‘But the economy is going to be so damaged and the unemployment rates so high that it’s going to take many years. We’re destroying the economy as we go.

“My message to the Government would be make some decisions, give us something to hold on to and take advantage of the low interest rates that are definitely here for the foreseeable future. ‘Because the pain of 20 to 25 per cent unemployment and the suffering and the hardship that will cause will be three times worse than this virus.”