30% of bars, restaurants and cafes in Spain could be forced to shut permanently due to coronavirus crisis

SPAIN’S government has been warned that up to 30% of catering businesses could be forced to permanently shut their doors due to the coronavirus crisis at the cost of 400,000 jobs.

The grim forecast has come from trade body Hosteleria de España. Its president Jose Luis Yzuel revealed the stark figures to the Commission of Industry, Trade and Tourism .

He based the numbers on several reports from consulting firms EY&Bain and Foqus and the University of Valencia.

Of the 1.7 million people employed in the hospitality sector before the crisis, only 1.4 million are still registered in the social security system. Of those, 63% were covered by the ERTE furlough scheme in May, according to the National Office of Statistics (INE).

Yzuel claimed that so far 20% of the more than 300,000 hospitality sector establishments in Spain have permanently closed since the start of the coronavirus crisis.

He expects this will increase to up to 30% – or 90,000 businesses – by the end of the year.

Before the crisis around 40,000 restaurants, cafes, bars and hotels ceased to trade each year, a figure matched by the numbers opening. Yzuel predicts that this year the number of openings will not exceed 20,000.

In cash terms, he estimates that the sector will have lost 40% of its income this year compared to last.

Yzuel called on the government to support the sector in the coming months.