Number of pubs and bars going bust soars by 53%
Pubs and bars are being hammered by the introduction of the National Living Wage, poor weather, England's early exit from Euro 2016 and the Brexit decision, with increasing numbers going bust as a result.
Figures from insolvency specialist Begbies Traynor show that the number of pubs and bars which were dissolved in the second quarter increased 53% to 831.
The research also reveals that one in five pubs and bars faces "significant financial distress", also up from last year.
Julie Palmer, partner at Begbies Traynor, said: "The knock-on effect of England and Wales's exits from the Euros, and the damage to consumer confidence in light of the current economic and political uncertainty, means the UK's pubs and bars face serious challenges ahead that could result in more business closures or failures over the coming months."
Data from Barclaycard has already shown that consumers reined in their spending in pubs and restaurants towards the end of June. Such spending , which traditionally sees double-digit growth at the end of the month when many people get their pay packets, fell back by 0.44% and 0.46% respectively in the seven days starting on June 24.
To compound matters, some 60% of consumers expect the general economic situation to worsen in the next 12 months, up from 46% in June, according to a one-off GfK Consumer Confidence Barometer taken after the EU referendum.
Ms Palmer said: "The longer term impact of the introduction of the National Living Wage remains to be seen but, given the sector's model of tight margins and low cost staff, many businesses are already struggling to cope with the increased costs.
"Given the current financial state of many of the UK's pubs and bars, many could be forced to either cut staff to reduce costs or face falling into the red."