75% of UK hair & beauty businesses struggling to recruit more than 12 months ago
By Rebecca Hitchon | 30 July 2024 | News
The National Hair & Beauty Federation (NHBF) has released the findings of its latest quarterly State of the Industry survey.
UK hair and beauty businesses are continuing to battle the challenging economic climate, with this the biggest challenge for them, followed by recruiting experienced staff and finding apprentices. 16% of businesses reported making a loss, compared to 12% in April’s survey.
Businesses are most concerned about increases to the National Minimum Wage/National Living Wage, then energy costs and trade supplies.
In response to economic concerns, 48% of businesses are putting up prices, 47% are holding off taking on new staff or apprentices, and 24% are reducing staff hours.
Compared with 66% of businesses raising their prices in April to cover rising wage rates, there has been a slight reduction in price increases (58%). 46% of businesses will raise their prices over the next three months.
Businesses’ workforces and recruitment intentions are similar to April, with 20% (up from 16%) being ‘definitely’ or ‘likely’ to take on staff. 15% said they would take on apprentices in the next three months. This comes as 75% of businesses note it is more difficult to recruit compared to a year ago.
Over half of sector businesses (55%) are either partially or completely reliant on government support. 53% are also in debt, down 3% from January, with 50% saying it will take them between two and five years to clear.
However, future expectations remain positive, with 76% of businesses confident of their survival over the next six months, 43% intending to rapidly or moderately grow, and 55% expecting turnover expectations to stay the same in the coming three months. 28% (down from 34%) expect turnover to increase.
Caroline Larissey, chief executive of the NHBF, comments:
“The sector makes a significant contribution to the high street and community wellbeing with a continuing rise in the number of barbers, beauty salons and nail bars, yet a decline in the number of hairdressers and hair and beauty salons.
“Many businesses have benefitted from business rates discounts and support on energy costs, but further targeted support to small and micro employers will be needed, including through the government’s proposed growth & skills levy, to unlock the sector’s full potential.”
With 61% of hair and beauty businesses noting that reducing the VAT rate would be most beneficial for them, followed by a slower rise of the National Minimum Wage/National Living Wage and further increase of the VAT threshold, Caroline continues: “The rise to the VAT threshold announced in the Spring Budget benefitted many businesses, but further reform is needed to support the sector.”