Pound sterling slump after Brexit vote leads to sharp decline in hotel closures

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There has been an 18 per cent fall in the number of UK hotel insolvencies in the last year as a result of the fall in the value of the pound attracting more tourists from both at home and abroad, new research has revealed.

A study, published by accountancy firm Moore Stephens on Monday, shows that fewer than 1 per cent of hotels are now deemed to be at significant risk of becoming insolvent – chiefly because of an influx in tourism.

The pound has lost around 10 per cent of its value against the US dollar, and around 13 per cent of its value against the euro, since the June 2016 Brexit vote. According to the Office for National Statistics, that translated into a 9 per cent increase in international visitors to the UK during the first six months of the year.

Separately, British people are also increasingly opting to stay at home for their holidays, also largely because of the higher cost of travelling abroad.

Despite this uplift however, Vincent Wood, partner and head of hotels at Moore Stephens, says that the Brexit vote hasn’t purely been good news for the sector.

He says that the industry is already suffering from a shortage of staff as a result of the referendum, because fewer European nationals are eager to work in the UK.

“The potential drying of this vital reservoir of staff is a problem hotels have faced for many years and it will be a real challenge for them in the coming period,” he said.