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The Scale and Diversity of the Hospitality Industry

Andreea Melinda Mirza

Unit 1. P1

By definition, the hospitality industry is a service industry. It is much broader than

most other industries and it applies to nearly any company that is focused on customer
satisfaction and meeting leisurely needs rather than basic ones. It is a multi-billion euro
industry that depends on the availability of leisure time and disposable income. Hospitality is
a board and varied industry ranging from single-person organizations to worldwide
corporations. People do a total of over 80 different jobs in these industry.
Sectors of the hospitality industry
Hospitality and tourism is one of the UKs most diverse sectors, comprising a range of
different industries, but all with their roots in the service sector. Regardless of the size of an
organization, these similarities mean that they face similar challenges.
The hospitality industry represents more than hotels and restaurants, it includes a total
of 14 different sectors as it follows:

hospitality services;
pubs, bars and night clubs;
contract catering;
membership clubs;
holiday parks;
visitor attractions;
tourist services;
travel services;

The number of businesses in the UKs hospitality industry

In 2012 there were 181,500 individual business sites operating across the hospitality
industry. As measured by the number of employees, the hospitality sector is predominately
made up of small businesses1.
Table 1 The number of businesses by sector

Number of businesses




Pubs, Bars and Night Clubs















parks and hostels




Tourists services









Visitor Attractions



Hospitalitys importance in the economy

The hospitality industry makes a major contribution to the UK economy and employs
a large percentage of people. In some parts of the UK the industry is the main source of
income and employment. It is a great industry for those who want to set up their own
business, as well as for people who want to progress in their career in a multinational
corporation. It is well known that while most businesses in the sector are small, larger
businesses employ the greatest proportion of staff. For example, 42 percent of people work
for an organization with 250 or more employees, however these larger organizations
represent less than one percent of sector businesses. In terms of impact upon the workforce,
greater reach can be achieved by engaging with larger employers
1 STATE OF THE NATION REPORT 2013, An analysis of market trends, skills, education and
training within the UK hospitality and tourism industries; Hospitality Guild 2012 in
association with UKSP

In recent years, the sector has performed considerably better than the economy as a
whole in spite of the recession, increasing its contribution by 13 percent between 2010 and
2011, compared to the overall economy.
The hospitality and tourism sector continues to be a major UK employer and is
playing a critical role in helping people into jobs.
According to the State of The Nation Report 2013, the latest figures from 2011 show
that the workforce currently stands at 2,076,000; an increase of 0.7 percent on the previous
year. This increase is higher than the average across the economy as a whole (0.5 percent)
and demonstrates the resilience of the sector in the face of the economic downturn.2
The sector has always employed a high proportion of part-time workers, enabling
businesses to respond to fluctuations in customer demand. Nearly half of the hospitality and
tourism workforce is employed on a part-time basis (48 percent).
The sectors workforce has traditionally been much younger than across the economy
as a whole, with more than 40 percent of employees currently under 30. In the sector most
workers are women, most workers are aged 35 to 55 with over a third of staff being under 25.
The sectors managers are also comparatively young (see table 16), underlining the
opportunities for career progression in the sector.
As the hospitality industry continues to grow and other sectors contract, its relative
importance to the UK economy is increasing. The low barriers to entry mean that people can
start working in the sector with little experience and develop into higher skilled and
management positions. This provides the Government with an opportunity to work with
sector employers to help get more people into work and to support its social mobility

2 STATE OF THE NATION REPORT 2013, An analysis of market trends, skills,

education and training within the UK hospitality and tourism industries;
Hospitality Guild 2012 in association with UKSP
3 STATE OF THE NATION REPORT 2013, An analysis of market trends, skills,
education and training within the UK hospitality and tourism industries;
Hospitality Guild 2012 in association with UKSP

In 2010 the hospitalitys industry turnover in the UK was of 90 billion and is worth
46 billion to the UK economy in wage and profits, and directly contributes 2.44 million
jobs, and over 1.2 million jobs through multiplier effects (the sum of indirect and induced
employment).4 Nearly half million people are employed in restaurants, 400.000 work in the
service sector of the industry.
With 2.44 million direct jobs representing just below 8% of total employment these
makes the hospitality economy the UKs 5th biggest industry in terms of employment.
As it can be seen, the scale and diversity of hospitality industry are large and complex
and its importance for the UK economy is growing by the year. The multitude of jobs it
creates and the diversity of these business makes it attractive to the available workforce and
creates opportunities for everyone interested in the sector.

4 OXFORD ECONOMICS, Economic Contribution of UK hospitality industry, Final

report September 2010