Many pubs in Dublin are struggling with inflationary price rises as well as reduced footfall as pub goers cut back on their spending.
More than 36% of pubs in Dublin say they will have to cut staff levels if the Irish government raises minimum wages any further, according to a survey by the Licensed Vintners Association (LVA).
From 1 January this year, Ireland’s government has announced, the minimum wage for employees aged 20 and above will be €12.70 per hour, while those aged 19 will get €11.43 per hour. The rate for employees aged 18 is €10.16.
Recently, however, according to The Irish Independent, the Low Pay Commission has reportedly advised that the minimum wage should be raised to €13.70 next year.
If this happens, 21% of the 350 Dublin pubs surveyed, said it would mean they were likely to hire fewer new employees than initially planned. About 15% of pubs have also revealed that, if minimum wages were to rise, it would no longer be profitable for them to stay open during the whole week.
A number of other planned changes to employment laws in Dublin have also been announced, including changes to sick pay, as well as to the pension auto-enrolment scheme and employers’ Pay Related Social Insurance (PRSI). A rise in Value Added Tax (VAT) is also under consideration.
Almost all – 96% – of Dublin pub owners surveyed, feel changes are happening too fast, and they are urging the government to slow down and postpone the implementation of the “Living Wage”.
Increasing calls for Irish government to slow down changes
Dublin pubs are struggling with the inflationary price rises which has meant reduced footfall and pub-goers spending less on outings than they might have done previously.
Pub owners believe the number of changes being proposed by the Irish government could further erode away pub profit margins at an already difficult time.
Donall O’Keeffe, CEO of the Licensed Vintners Association (LVA), said: “Hospitality businesses simply can’t cope with the increased cost of doing business that is being foisted on them by the government.
“Over the last year, there have been increases in value added tax (VAT), sick pay, employers’ PRSI and minimum wage, with significant further increases to come. This simply isn’t sustainable and it should come as no surprise that so many hospitality businesses are closing in this environment.
“We’ve been saying the government changes represent too much, too fast. That is why we are calling for the government to slow things down. We understand the need for a living wage but we feel that it should be introduced over a five-year period from 2025 to 2029 and that the 2025 increase in minimum wage should be in line with inflation.”
