Employment in the Hospitality Industry

According to the Irish Central Statistics Office, seasonally adjusted employment in the Irish hospitality sector grew during each of the nine quarters from Q1 (Jan/March) 2002 to Q1 2004. Employment in the sector fell during each of the next four quarters, following the introduction of the smoking ban in March 2004 (Central Statistics Office, Dublin).

This reverse in trend was unique to the hospitality industry – the rest of the private sector economy continued to increase employment in every one of those quarters. So, whilst hospitality slumped, by an average 3.8%, the rest of the private sector grew by 3.4% - a difference of 7.2%.

It was only at the end of 2005 – nearly two years after the ban was introduced – that employment in the hospitality sector regained its pre-ban levels (115,400 jobs in Q4 2003 vs 115,500 jobs Q4 2005). By contrast employment in the rest of the private sector had expanded from 1,223,700 in Q4 2003 to 1,323,000 in Q4 2005 – a growth of 8.1%.

Taking these two measures as key indicators of the performance of the sector, the negative impact of the ban on overall hospitality employment appears to have been in the region of 7- 8%.

It should further be noted that these data cover the whole of the hospitality sector (‘Hotels and Restaurants’) not just pubs and bars.

It would be reasonable, however, to assume that the job losses fell most heavily on the pubs and bars, due to the concentration of smoking in these outlets. Hotels, restaurants and guesthouses could be expected to be relatively unaffected.

This suggests job losses of 10% or greater for the pubs and bars sector. The impact on retail sales through the bars sector shows a similar decline as a result of the ban.