22,500 jobs at risk in drinks sector as pubs on track for 50% decline in business for the remainder of 2020

Abstract

Economist Anthony Foley authors report on impact of Covid-19 on the drinks industry and analyses the effect of a reduced VAT rate on on trade alcohol sales. Report concludes that consumer demand will be lower after lockdown due to higher unemployment and reduced earnings while it will likely be 2023 before we reach pre-Covid labour market conditions. LVA, VFI and Ibec representative group Drinks Ireland have convened to call for a temporary reduction in the VAT rate on alcohol sales in pubs to 'support a 5,000-strong network of nationwide businesses that will struggle in the short-term'. Report finds that most bars will reopen with only 40% of their customers, indefinitely. The 'Reduce VAT on On-Trade Alcohol' report was published as part of the 'Protect our Pubs' campaign to highlight the role pubs play in communities and the loss should some never reopen. Economist Tony Foley: 'Our most optimistic market expectations for the second half of 2020 are that on-licence alcohol sales will be at most 50% of what is usual'.