Employment in the tourist industry will fall in the coming months due to the foot and mouth crisis, according to CBI research.
The joint CBI and Deloitte & Touche service sector survey shows that both business trading and confidence for the next few months drops significantly. Foot and mouth has had a serious impact on several consumer service sectors dependent on tourists, claims the research.
Employment in the service sector was unchanged over the past three months, but companies in the hotel, coach service and travel operator sectors expect that employment will fall markedly over the next quarter.
More than a third of service sector firms considered the volume of their business to be below normal. Furthermore, profitability among consumer services is expected to decrease at a faster rate over the next three months.
“Confidence has been hit by the expectation that the foot and mouth outbreak will have a wider and more prolonged effect on consumer services,” said CBI’s associate director of economic analysis Sudhir Junankar.
The survey of 236 firms was carried out in May 2001.