The Leisure sector showed growth in 2018, helped by positive economic conditions and an increase in tourism. For example, the fast food industry, restaurants and hotels showed growth. This offers reason for optimism. Still, vigilance is needed for entrepreneurs in the sector: staff shortages bother the sector, supply has increased in recent years, and consumer confidence declined in recent months.

Consumer confidence down, but is above average

Consumer confidence fell in December for the fifth month in a row, to a score of 9. The score was not this low before in 2018 and 2017, but consumer confidence is still well above the long-term average.

The drop in consumer confidence in December appears to have both economic and financial reasons. The decreased score about the economic climate may be related to a number of international events, such as the Brexit troubles, the budget woes in Italy and the trade conflict between the U.S. and China. In addition, the prospect of slower economic growth in the Netherlands may play a role in this.

At the same time, consumers are also more cautious about their own financial situation. It is possible that the prospect of a smaller increase in households' disposable income in 2019 plays a role here.

Foundations for growth present for Leisure in 2019 and 2020

The fundamentals of growth remain in place. Consumers have more eating occasions than before and visit fast food outlets and restaurants (for example) with great frequency. This also has demographic reasons: one in five millennials eat out at least once a week. That's more than older generations.

Another important foundation for growth is tourism. In 2018, the number of lodging stays increases by 4.2%. For 2019, we assume 3.7% growth in the number of lodging stays, carried mainly for foreign tourism.

At the same time, not every entrepreneur recognizes the sector growth. This is also because supply has increased in several places.

Staff shortage sleeper

Entrepreneurs in the Leisure sector are also suffering from this staff shortage. The hospitality industry currently has 49 vacancies for every 1,000 jobs. The vacancy rate has not been this high since 2008. Thus, (net) 30% of entrepreneurs in the hospitality industry experience the shortage of staff as an obstacle, in the fourth quarter of 2018. The figure was 18% a year earlier, and 5% in the fourth quarter of 2016. Several restaurants and cafes had to close because there were not enough staff available to run these businesses.

The shortages particularly concern cooks and waitresses. Earlier, the UWV mentioned that there is a high turnover among people who have trained as cooks. It is therefore important that companies know how to keep their employees on board, for example by offering them clear career prospects. Partly due to this shortage of personnel, the growth of the Leisure sector is slowing down. We assume 3% growth for 2019 and 2.5% growth for 2020.

Want to know more?

More information about the economy and the Leisure sector can be found in the new 'State of Leisure‘.

Click here for the full article.