The UK’s night-time economy is showing only tentative signs of recovery, with new data revealing ongoing losses and a deepening crisis for independent venues. The warning comes from the Night Time Industries Association (NTIA), following the release of its latest Night Time Economy Market Monitor, produced in partnership with CGA by NIQ.
The report reveals that 15.8 percent of independent night-time businesses have closed since March 2020. Although nightclub numbers have risen by 5.4 percent in the last year, this remains well below pre-pandemic levels. Overall, nightclub numbers are still down by 34 percent compared to 2020, which equates to the loss of around three venues per week over a five-year period.
The late-night economy, defined as trading after 11pm, has seen a slight annual increase of 2 percent, but the total number of venues remains 13.6 percent lower than before the pandemic. The broader night-time economy has grown by just 0.2 percent year-on-year.
The sector is clear that these minor signs of year-on-year recovery are already under immediate threat. The Chancellor’s Autumn Budget, which came into force in April, has introduced a wave of rising costs, increased taxes, and declining consumer confidence.
Michael Kill, CEO of the NTIA, said the figures should not be taken as signs of recovery. “While our sector is remarkably resilient, modest figures of growth should not be mistaken for recovery. What we are seeing is the barest flicker of life after five years of near-collapse. A 5 percent growth in nightclubs sounds positive, until you remember we’ve lost 34 percent of them since 2020,” he said.
“The reality is the night time economy remains in a deep crisis of the Government’s doing, most recently as a result of the Autumn Budget. Without urgent intervention, the small signs of resilience we’re seeing now will be put out entirely, and disproportionately so on independent venues deeply cherished by and so valuable to communities,” he added.
The NTIA has backed its concerns with a flash survey of more than 500 operators. The results show that over 90 percent of businesses have already cut or plan to cut staffing levels, operating hours or investment. Forty percent of businesses surveyed believe they will be forced to close within six months unless financial support is made available.
Further concerns were highlighted by a separate consumer survey carried out in April by Obsurvant. Polling 2,000 people aged 18 to 30, the survey found that 71 percent of respondents identified poor late-night transport as a major barrier to attending events. Safety was also a key concern, with 55 percent of young adults citing issues such as drink spiking. Nearly 60 percent reported feeling less pressure to drink alcohol, reflecting a shift in social behaviour and venue expectations.
Karl Chessell, Director – Hospitality Operators and Food, EMEA at CGA by NIQ, said, “These numbers show how hard businesses in late-night hospitality have worked to build back from the turmoil of COVID-19. They have also adapted very well to consumers’ changing leisure needs and are shaping a new and dynamic night time economy. However, extra costs and ongoing inflation, alongside hesitant consumer spending, means many businesses’ cash reserves are rapidly being depleted. Urgent and targeted action is needed to tackle this jeopardy and ensure hospitality can help kickstart an economic revival”.
Although experience-led formats such as themed bars and early evening socialising are showing growth, these are not enough to offset broader structural issues. The NTIA estimates that many businesses are facing annual cost increases ranging between £35,000 and £100,000 due to changes introduced in April’s Budget.
The association is calling for a reduction in VAT for hospitality and events, alongside relief on business rates, National Insurance and energy costs. It is also pressing for investment in late-night transport and public safety, and formal recognition of the night time economy as a key part of the UK’s cultural and economic landscape.
Kill said, “Appetite for meaningful, shared cultural and social experiences is strong. It’s up to policymakers and industry leaders alike to ensure the infrastructure exists to support it.”