Nightclub owners have warned they face a looming “financial armageddon” that could put three quarters of a million people in the struggling night-time economy out of work within weeks.
More than half of members of the Night Time Industries Association (NTIA) fear they will collapse within the next two months unless they receive increased government support to see them through the coronavirus crisis, according to a survey by the trade body.
This could cost 754,000 jobs, the NTIA warned, with nightclubs particularly hard hit – particularly in smaller towns – due to ongoing uncertainty about when they will be allowed to reopen.
The concerns echo those of some pub owners, who have complained that they have nothing to gain from measures such as a VAT cut on food and the “eat out to help out” meal discount scheme.
“We will be looking at a redundancy round as early as the next two or three weeks [unless something changes], which could involve several hundred, mainly young, people,” said Peter Marks, chief executive of Deltic Group, the UK’s largest nightclub operator with 53 venues.
He said the group, which has clubs in cities and student towns across the country, had not been eligible for any state support for businesses at risk of collapse due to Covid-19.
“We have played the game, not tried to pretend our venues are pubs or anything, not done anything but toe the government line but we’ve had no financial assistance that will enable us to survive if this goes on.
“Every week that passes we’re in a more precarious position. If we don’t have an opening date, how on earth can we survive and plan? We believe there’s a way back but if the government need us to shut then they’ve got to help us.”
According to the NTIA survey of 360 businesses, more than 70% expect to make at least half of their workforce redundant by September and 58% won’t survive more than two months without financial assistance.
“These results feel like the final catastrophic blow to the night-time economy,” said NTIA chief executive Michael Kill.
“These businesses cannot fight for their survival for much longer. The night-time economy employs 1.3m people in the UK and contributes £66bn to the UK economy per annum.
“Give us a clear roadmap on when businesses can reopen and reassurance that the financial support will be there to keep businesses financially afloat in the coming months.”
Clubs are also expected to be among the last entertainment venues to be allowed to reopen as the government seeks to control the spread of Covid-19.
A handful are eligible to apply for some of the £1.57bn in Arts Council funding available to cultural organisations, after the successful #LetUsDance campaign, supported by DJs and musicians such as Fatboy Slim and Thom Yorke.
But many, such as those operated by Deltic, are not eligible because they are not considered to be of significance to the UK’s international cultural reputation.
“Cities are robust but I’ve never known a town centre get better because they lost their last club, it’s an anchor of the night-time economy in any town,” said Marks.
“If they close, they all too often never reopen.”
Jeremy Joseph, owner of G-A-Y, Heaven nightclub warned that many nightclubs would be “consigned to the history books forever”.
“No business should be forced into making the heart-wrenching decisions that might lay ahead if government don’t act to address this crisis,” he said.
“The loss of any club or venue in the UK would send shockwaves through communities and leave future generations socially starved.”
Government initiatives such as a VAT cut on food and soft drinks – as well as the eat out to help out meal discount scheme – have largely focused on venues that serve food.
Like nightclubs, so-called “wet-led” pubs, that rely on sales of alcoholic drinks and do not serve much food – have said they fear financial ruin after being excluded from the industry bailout.
When asked for comment a government spokesperson said: “We know this is an incredibly difficult time for nightclubs, but they will need to remain closed for now in line with current scientific advice to control the virus.
“Throughout the pandemic, nightclubs have access to the government’s unprecedented package of support to help businesses, which includes business rates relief, tax deferrals, the coronavirus job retention scheme and billions paid in loans and grants.”