Hospitality Industry Statistics UK 2026

The UK hospitality industry is one of the nation’s economic powerhouses – the third-largest employer, a magnet for international visitors, and a sector that touches everything from local pubs to luxury hotels and large-group holiday lets. These UK hospitality industry statistics bring together the latest data on market size, employment, tourism, accommodation trends, challenges and opportunities, offering clear, citable insight into the state of an industry navigating record costs, shifting consumer behaviour and a growing appetite for experiential travel and group getaways.

The UK Hospitality Market: Size and Economic Contribution

Overall Market Valuation

• The UK hospitality market was valued at USD $69.50 billion in 2024 and is projected to reach USD $99.38 billion by 2032, growing at a CAGR of 4.5% from 2026 to 2032
• Mordor Intelligence values the UK hospitality market at USD $63.80 billion in 2026, rising to USD $78.28 billion by 2031 at a 4.18% CAGR — a more conservative estimate reflecting the accommodation-focused segment
• UKHospitality’s Quarterly Sales Tracker reports that sector revenue reached more than £145 billion in Q4 2024, representing a 10% increase on pre-pandemic levels
• The wider UK hospitality sector (including all food service, accommodation, leisure and events) is valued at approximately £130 billion in 2025

Contribution to the Economy

• Hospitality directly contributes £93 billion annually to the UK economy – an increase of £20 billion in just six years
• The sector generated £54 billion in tax receipts for the Treasury and £20 billion in exports in 2022
• Hospitality attracted £7 billion in business investment in the same year
• The sector accounts for approximately 2.8% of UK GDP (£69.5 billion in 2023), according to the House of Commons Library
• Hospitality is growing at a rate of 5.9%, almost double the rate of the wider UK economy
• Restaurants, pubs and clubs generate over 50% of the sector’s total economic contribution

Employment: The UK’s Third-Largest Employer

Current Workforce

• Hospitality is the third-largest employer in the UK, behind only wholesale/retail and health/social care
• The sector employs 3.5 million people according to UKHospitality (Ignite Economics report), with ONS data for 2024 showing 3.6 million directly employed
• Hospitality ranks as a top-five employer in every UK region, accounting for up to 12% of each regional workforce
• Between 2009 and 2019, hospitality accounted for 17% of overall UK employment growth, placing it fifth in total jobs created

Post-Budget Job Losses (2024–2026)

• UKHospitality reports that approximately 89,000–100,000 jobs have been lost across the sector since the October 2024 Autumn Budget
• In December 2025 alone, the sector employed 8,784 fewer people than November 2025, at a time when hospitality would traditionally be staffing up for the festive period
• Between September and December 2025, hospitality employed 20,014 fewer people
• One-third of hospitality businesses are reducing operating hours, one in eight is closing locations, and 60% are downsizing their workforce
• UKHospitality warned that the sector could shed a further 100,000 employees as minimum wage increases, employer NICs rises and business rates changes take full effect

Wage Pressures

• The National Living Wage rose from £11.44 to £12.21 per hour in April 2025 – a 6.7% increase
• From April 2026, the NLW will increase further to £12.71 (a 4.1% rise), with the 18–20 rate rising 8.5% to £10.85
• The combined wage increases represent £1.4 billion in additional costs for hospitality businesses
• Payroll costs across UK hotels increased year-on-year by 4.9% PAR in Q1 2025
• Labour costs in hospitality overall rose by 8.5% compared to Q1 2025, outpacing the mandated 6.7% wage hike

Business Closures and Insolvencies

Hospitality Insolvencies

• 3,353 accommodation and food service companies entered insolvency in the 12 months to December 2025 – down just 3.2% from 3,464 in 2024
• In 2023, the figure was 3,737 – the recent peak – meaning insolvencies remain historically elevated
• Hospitality was the third-highest sector for insolvencies across all UK industries in 2025, behind construction and retail/wholesale
• Monthly hospitality insolvencies have remained consistently above 220 throughout 2025 (aside from December’s 204)
• High-profile casualties in 2025 include BrewDog (closed 10 venues), Oakman (entered administration), Bistro Live, Leon Restaurants, The Coconut Tree and Pizza Hut franchise DC London
• Hospitality faces an estimated £3.4 billion in additional annual costs from Budget measures

Pub Closures

• The UK had 60,800 pubs in 2000, falling to 55,400 in 2010, 46,850 in 2020, and approximately 45,000 in 2024
• Over the past five years, 2,283 pubs have vanished – equivalent to roughly eight per week
• In the first half of 2025 alone, 209 pubs closed across England and Wales
• The British Beer and Pub Association projects 378 pub closures in 2025 across England, Wales and Scotland, leading to 5,600 direct job losses
• Business rates relief for pubs was cut from 75% to 40%, landing the sector with an extra £215 million in tax bills — a 140% increase in average pub business rates

Restaurant Insolvencies

• 1,409 UK restaurants entered insolvency in the year to September 2024, up 19% from 1,180 in the previous period
• Q2 2024 saw 370 restaurant closures – the highest quarterly total in a decade

Inbound Tourism: Visitors Coming to the UK

2025 Performance and 2026 Forecast

• VisitBritain estimates 43.6 million inbound visits in 2025, with visitors spending £33.4 billion – representing 101% of 2019 visit volumes and 117% of 2019 spending in nominal terms
• For 2026, VisitBritain forecasts 45.5 million inbound visits and £35.7 billion in spending – representing growth of 4% in visits and 7% in nominal spend over 2025
• In real terms (adjusted for inflation), 2025 spending was only 91% of 2019 levels, showing the sector has not fully recovered purchasing power
• The UK remains among the world’s top five tourism earners

Tourism’s Economic Footprint

• In 2025, tourism is projected to contribute £257 billion to the UK economy and support 3.8 million jobs
• United States tourists are the UK’s largest inbound market by volume
• Between April and June 2024, visitors made an estimated 10.8 million visits and spent £7.9 billion

Domestic Tourism and Staycations

The Scale of Domestic Travel

• In 2024, UK residents took 105.6 million overnight trips within Great Britain, accounting for 308 million overnight stays and £32.9 billion in spending
• On top of overnight travel, Brits made 1.0 billion day visits in 2024, spending £54.8 billion
• Combined domestic tourism spend (overnight + day visits) totalled approximately £87.7 billion in 2024 — far exceeding inbound visitor spending
• In Q3 2025, total domestic tourism spend reached £25.2 billion – up 11% year-on-year

Staycation Behaviour

• For the first time in recent years, more Brits plan a UK staycation (52%) than travelling abroad (46%)
• Nearly two-thirds (63%) of all Brits will take at least one UK break in 2025, with 34% choosing it as their main summer holiday
• UK adults expect to take an average of three UK breaks in 2025, making domestic holidays a repeat purchase
• The average spend per domestic overnight trip in 2024 was £312 per person — a 17% increase on 2023
• Average spend per night on a UK trip reached £107 in 2024 – up 16% year-on-year
• 48% of UK stays are short breaks of six nights or fewer (up from 41% in 2023), confirming a shift toward micro-cations
• Analysts estimate the UK staycation market will grow to £55–60 billion annually by the early 2030s, up from roughly £33 billion in 2024

Most Popular Domestic Destinations

• Scotland is the top choice for 62% of UK travellers
• South West England (Cornwall, Devon) remains dominant for overnight stays
• Wales (Gwynedd, Anglesey) is popular for short breaks
• Yorkshire & The Humber – North York Moors rated the #1 sentiment destination
• London remains the top urban destination

Accommodation Preferences

• Cottages and self-catering: Dominant choice, with 42% of UK travellers favouring cottage-style stays
• Hotels: Remain the largest accommodation segment by revenue
• Camping & caravans: 14% of Brits plan a camping or caravan holiday
• Glamping: Bookings up 8% year-on-year in early 2025
• Large group houses: Growing demand for exclusive-use party houses and large self-catering properties for celebrations, reunions and group getaways

The UK Hotel Market

Revenue and Performance

• The UK hotel market is projected to generate £22.9 billion in revenue in 2025, down from £24.3 billion in 2024
• UK hotels hold £37.1 billion in total assets, borrow £9.6 billion and have an overall net worth of £11.4 billion
• Average Daily Rate (ADR) across the UK averaged £105 for the full year 2024
• London hotel profit conversion reached 43%, though the GOP margin remains three percentage points below 2019
• Regional UK hotels achieved GOPPAR growth of over 7% in 2024, reaching more than £38 per available room
• Golf & Spa hotels continued to outperform, with ADR growth of 4.1% in Q1 2025

Market Structure

• Independent hotels held a 57.28% market share in 2025, though chain hotels are growing faster
• Chain hotels are expected to grow at a 7.88% CAGR from 2026–2031
• Luxury is the fastest-growing accommodation class, projected at 7.98% CAGR from 2026–2031
• OTAs (Online Travel Agents) held 37.24% of bookings in 2025, while direct digital channels are growing at 7.34% CAGR
• Key players include Whitbread (Premier Inn), IHG, Compass Group, Greene King and Mitchells & Butlers

Holiday Lets and Short-Term Rentals

Market Size and Supply

• The UK vacation rental market is projected to reach $4.68 billion (approximately £3.7 billion) in 2025, with 78% of revenue coming from online bookings
• Active short-term rental listings in the UK climbed to a record 375,400 by January 2026, up from approximately 344,600 two years prior
• There are approximately 147,000 dedicated holiday lets in England and Wales, representing just 0.6% of the total housing stock
• Dedicated holiday lets support approximately 139,000 jobs and contribute £6.6 billion in Gross Value Added (GVA) annually
• Total income from UK furnished holiday lettings was £2.43 billion in 2023/24, with 130,000 individual landlords declaring this income
• The average annual turnover of a UK holiday let was £24,700 in 2024 – up from £24,500 in 2023

Performance Metrics (2025)

• Annual average occupancy across UK STRs: 56%
• Annual average ADR: £135
• Annual average RevPAR: £75
• Peak summer occupancy (August): 70% with ADR of £152
• Holiday lets typically earn 30–50% more per year than comparable long-term rentals
• Top-performing regions (Lake District, Cotswolds) generate average turnover of £40,000+ per property

Supply Growth and Competition

• National average year-on-year supply change: +19.94% in 2025
• London saw the largest absolute increase: +13,694 new listings in 2025
• Birmingham experienced the fastest relative growth at +44%, followed by Salford (+39.69%) and Manchester (+39.20%)
• Despite growth in supply, RevPAR has remained resilient thanks to strong ADR performance from professionalised listings
• Dedicated holiday lets in England have grown at a steady 1.9% annually since 2016

The Party House and Group Accommodation Market

Market Size

• The UK party house rental platform market is valued at approximately £1.2 billion, with an annual growth rate of around 12%
• The global party house rental platform market is estimated at $23.1 billion (2025), growing at a CAGR of 7.8% through 2033
• London and the South East dominate the UK market, accounting for nearly 60% of total revenues
• Luxury and premium party houses command the largest segment share, driven by affluent consumers and corporate event organisers
• Platform bookings surpass 3 million annually in the UK, reflecting a shift from traditional event venues to digital rental solutions

The Stag and Hen Party Economy

• The UK stag and hen weekend sector is estimated at £400–600 million annually, supporting thousands of hospitality jobs
• There are approximately 175,000–210,000 stag and hen celebrations per year in the UK, involving 2.2–2.7 million participants
• Average spend per person has increased 42.8% from 2022 to 2025 (£152 → £217), significantly outpacing inflation
• Stag weekends dominate at 85.5% of bookings, with hen weekends representing 13.6%
• Average group size: 13 people for both stag and hen parties – consistent for over a decade
• The 3-day weekend is now the industry standard, accounting for nearly half of all bookings
• 61.5% of annual bookings are concentrated in April–July, creating extreme seasonality
• Per-person spending: stag parties spend 47% more than hen parties (£200 vs £136)

Destination Trends

• The split between UK and international destinations is now almost exactly 50/50 (49.8% UK, 50.2% international)
• International destinations command a £37 per person premium over UK destinations (excluding flights)
• Belfast emerged as the fastest-growing destination (+3,400% growth), followed by Bucharest (+141%) and Albufeira (+120%)
• Traditional UK destinations are declining: York (-53%), Blackpool (-51%), Bournemouth (-45%)
• Edgier UK cities (Liverpool, Bristol, Newcastle) are gaining market share from coastal resorts

Weddings and the Events Sector

UK Weddings

• Approximately 265,000 couples get married every year in the UK
• In 2023, there were 231,949 marriages and civil partnerships in England and Wales — an 8.6% decrease from 2022
• The average UK wedding costs between £21,000 and £25,000, with the average guest count at 83–89 people
• The UK wedding venues market is worth £3.9 billion in 2025, with 7,663 businesses in the sector
• Civil ceremonies have increased to 85.7% of total, while religious ceremonies dropped to 14.3%
• Around 70–75% of weddings involve a stag and/or hen celebration, creating significant downstream hospitality demand

UK Events Industry

• The UK events market was valued at USD $85 billion in 2024, projected to reach $99 billion by 2035
• The global events industry reached $1.35 trillion in 2025, growing to $2.1 trillion by 2032 at a 6.4% CAGR
• 80% of companies have increased experiential marketing spend, with budgets now representing 10–30% of total marketing allocations
• Global experiential marketing spending reached an estimated $128.3 billion in 2024, surpassing pre-pandemic levels

Consumer Trends Shaping UK Hospitality

Experiential and Group Travel

• 70% of UK adults who plan holidays in 2025 look to synchronise dates with friends or family — fuelling demand for large-group accommodation
• 74% of Brits now travel for ‘bleisure’ — a combination of business and leisure in one trip
• 71% of 18–24 year-olds say it’s important that a holiday incorporates their hobbies or interests
• Multi-generational holidays, longer weekend stays and nature-led escapes are all growing trends for 2026
• The premiumisation trend is clear: groups are willing to pay significantly more for quality, curated, memorable experiences over budget options

Digital and Booking Behaviour

• 78% of UK vacation rental revenue comes from online bookings
• The average booking lead time for UK cottage-style stays is 105 days (2025), down from 114 days in 2024
• 24% of all UK breaks are now booked within a month of departure
• High-demand areas like Cornwall and Cumbria still see bookings made approximately six months in advance
• Direct digital booking channels are growing at a 7.34% CAGR, as operators seek to reduce OTA dependency

Sustainability and Wellness

• 28.3 million holidaymakers are now taking sustainable holidays in England alone
• 26% of dedicated holiday lets in England are located on farms, aligning with rural tourism and sustainability
• Wellness routines, spa therapies, culinary journeys with local ingredients and artisan workshops are among the fastest-growing experience categories
• Eco-friendly venues and sustainable materials are seeing heightened market appeal, especially among younger consumers

Regional Breakdown

England

• Accounts for 71.28% of the UK hospitality market
• 56,125 self-catering properties operating in England
• The South West leads for domestic overnight stays, followed by London, the North West and the South East
• London remains the primary gateway for international demand and the most attractive city for hotel investment
• Regional cities like Manchester, Birmingham and Leeds are sustaining momentum through diversified demand

Scotland

• Scotland is the number one domestic destination choice for 62% of UK travellers
• Edinburgh saw +845 new short-term rental listings in 2025, the third-largest increase nationally
• Scotland’s hospitality sector benefits from strong international appeal, whisky tourism and events like the Edinburgh Festival

Wales

• 22,000 dedicated holiday lets in Wales
• Holiday lets contribute £0.7 billion GVA to the Welsh economy and support 18,300 jobs
• Dedicated holiday lets in Wales have grown at 4.1% annually since 2021
• Gwynedd and Anglesey are particularly popular for short domestic breaks

Challenges Facing UK Hospitality in 2026

• Rising employment costs: Combined NLW increases, employer NICs rises and pension auto-enrolment changes add an estimated £3.4 billion in annual costs across the sector
• Business rates: Reduction in relief from 75% to 40% for hospitality has created a £215 million tax increase for pubs alone. Further reform is promised but not yet delivered
• Labour shortages: Post-Brexit immigration policies have made international recruitment harder. The sector’s vacancy rate remains above the UK average
• Cost-of-living pressures: Consumer spending is constrained, with 40% of event organisers expecting potential attendance drops due to cost pressure
• Energy costs: Average electricity and gas prices remain significantly above pre-pandemic levels, continuing to squeeze margins
• Staff burnout: Long hours, understaffing and increased responsibilities are leading to high turnover, curtailed trading hours and diminished service capacity

Opportunities and Outlook

• Experiential travel: The shift from ‘things’ to ‘experiences’ continues to benefit hospitality — particularly group accommodation, activity-based getaways and curated celebrations
• Premiumisation: Consumers are willing to pay more for quality. Per-person spending on group trips has risen 42.8% since 2022, and luxury is the fastest-growing hotel segment
• Domestic tourism resilience: With over half of Brits choosing UK holidays and the staycation market projected to reach £55–60 billion by the early 2030s, domestic demand remains robust
• Inbound growth: VisitBritain’s 2026 forecast of 45.5 million visits (+4% on 2025) offers optimism for accommodation and attractions
• Technology adoption: Digital booking, dynamic pricing, smart property management and AI-driven personalisation are helping professionalised operators outperform the market
• Off-peak demand: Remote working and flexible schedules are driving midweek and shoulder-season bookings, extending the traditional season
• Group and celebration market: With 265,000 UK weddings, 175,000+ stag/hen celebrations and millions of birthday parties, reunions and corporate retreats annually, large-group accommodation remains a significant growth area
• Government support signals: The Treasury’s November 2025 Budget set out plans to reduce the business rates multiplier for retail, hospitality and leisure properties — worth nearly £900 million per year to over 750,000 properties

Sources

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