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Pouring cocktails at Black Pearl
Photograph: Graham Denholm

Almost half Australia's hospitality venues have laid off staff in a month

Cassidy Knowlton

Hospitality venues across Australia are struggling to keep staff employed and keep the doors open due to the government's stringent restrictions on movements and strict physical distancing measures. Since March 1, some 70 per cent of the 3,000 venues surveyed by the Australian Bureau of Statistics have had to reduce staff hours, and 43 per cent have had to stand down workers or let them go entirely. And the ABS found that one in ten businesses had closed up shop completely since the start of last month. 

The news is even bleaker at the smaller end of the industry. The Night Time Industries Association (whose chairperson, Mike Rodrigues, is also managing director of Time Out Australia) surveyed 51 small hospitality venues across Melbourne, Sydney and Hobart and found all but one had stood down at least half of their staff since the start of March, with about two-thirds closing their doors completely. 

Although the government's JobKeeper scheme is a welcome relief to numerous sectors, including hospitality, many hospitality workers don't meet the eligibility criteria, as the scheme only applies to Australian citizens or permanent residents who have been with the same employer for at least a year. Additionally, many venues don't have the cash reserves to last until the JobKeeper payments kick in in May.

The stay-at-home orders couldn't have come at a worse time for Australia's hospitality businesses, which were hit hard by the reduction in tourist numbers due to the bushfire crisis over the summer. "A core concern remains short-term cashflow, which is simply non-existent for most as revenues were down 80 per cent or more in March, exacerbated by bushfire affected trade in January and February," says Rodrigues. "We will continue to put this and other sector-specific matters on the agenda of the government to ensure that we can save as many independent hospitality businesses as possible." 

Karl Schlothauer, owner of Sydney’s House of Pocket, says the way things are going, many businesses won't be able to survive. "I was one of the first small bars to open in Sydney, growing the business to seven venues,” he says. “Then I lost one during the lockout period, and had to put another into administration, leaving me with ongoing debts. Now we’re forced to shut, and cash reserves are diminishing. It is very possible that I will lose everything after ten years of work, paying over $15 million into the workforce and an enormous amount of payroll tax."

Matt Linklatler, one of the managers at Melbourne's Black Pearl (pictured), says the numbers just don't add up. “The reality is there’s no way for us to survive this lockdown whilst still paying full rent. We need rental relief for commercial property to ensure the vibrant hospitality landscape survives, as well as relief for residential property to ensure the staff that make our venues so great survive, too.”

Want to know more about the JobKeeper scheme? Here's what you need to know

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