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What Impact has Immigration had on Eating Out? - UK

Published by: Mintel International Group Ltd.

Published: May. 1, 2008 - 89 Pages


Table of Contents


Issues in the Market


Main issues

Definition

Abbreviations



Market in Brief

Eating out industry faces ‘triple whammy’

‘We couldn’t do it without them’, say operators

Migrants are hard workers, in contrast to many UK workers

Language barrier is biggest drawback of migrants

Ethnic restaurants particularly badly hit by new system

Signs of slowdown in flow of Eastern Europeans into industry

Figure 1: Trends in number of newly registered A8 workers in the catering sector, by occupation, 2004-07

Existing non-EU staff may have to go

An uncertain future for employers



Internal Market Environment

Key points

Trends in the number of hospitality and catering migrant workers

Figure 2: Nationality of WRS registered workers in the hospitality and catering sector, 2004-07

Figure 3: Geographical distribution of WRS registered workers in the hospitality and catering sector, 2004-07

Figure 4: Top sectors in which WRS registered workers are employed, 2004-07

Figure 5: Catering occupations in which WRS registered workers are employed, 2004-07

Immigration points-based system to cause major headaches

What is the points system and how does it affect the eating out industry?

How the system works

Attributes

Language skills

Maintenance

What are the main objections to the scheme among operators?

How important are formal qualifications?

How vital are language skills?

Must it be retrospectively applied to workers already in the UK?

SBS scheme workers can stay

What is being done to try and change the system?

Where now?

Language barrier low down the list of customer concerns

Figure 6: Negative factors of customer service likely to affect restaurant visiting, January 2008

Takeaway troubles on the horizon

Figure 7: Consumption of takeaway foods in the last 12 months, 2003-07

Price rises pile pressure on restaurateurs

Figure 8: Trends in the cost of restaurant meals compared to all items and food prices, 2002-07

UK’s cosmopolitan consumers

Figure 9: Types of restaurants visited in the last three months, 2003-07

Figure 10: Agreement with selected lifestyle statements, 2003-07

The ethical consumer?

Figure 11: Agreement with selected lifestyle statements, 2003-07



Broader Market Environment

Key point

Migration patterns

Figure 12: Migration patterns in the UK, 1997-2006

Figure 13: Migration patterns by citizenship, 2002-06

The impact of accession on migration

Figure 14: Migration balance by EU nations, 2004-06

Figure 15: National Insurance numbers issued to non-UK nationals, by country of origin, 2005/06 and 2006/07

PDI has driven immigration, though eating out growth

Figure 16: Trends in personal disposable income and consumer expenditure, 2003-13

AB growth positive in several ways

Figure 17: Forecast adult population trends, by socio-economic group, 2003-13

Figure 18: Forecast adult population trends, by lifestage, 2001-13

Shortage of front-of-house workers on the cards?

Figure 19: Trends in the age structure of the UK population, by gender, 2003-13



Strengths and Weaknesses in the Market


Strengths

Widespread availability of migrant workers

Strong work ethic of migrant workers

Reliability and flexibility

Fast learners

‘Authentic’ skills-base

Weaknesses

Over-dependence on migrant workers

The transient nature of the job

Points-based system could reduce potential ‘talent pool’ of employees

Language barrier

Concerned customers



Competitive Context

Key points

Eating out: Britons’ biggest area of leisure spend

Figure 20: Consumer expenditure on selected leisure goods and activities, 2003-07

Size and growth of sector makes it attractive to migrants



Market Size and Forecast

Key points

Figure 21: The UK market for eating out*, 2003-13



Segment Performance

Key points

Figure 22: The UK market for eating out, * by sector, 2003-07

Fast food, pubs ideal for migrants due to plethora of low grade positions

Stagnating ethnic sector



How Important are Migrant Workers to the Eating Out Industry?


An industry heavily dependent on migrant workers…

…and increasingly so

Migrant workers drive industry’s recent growth…

…continuing a trend of many years

Why the boom in the proportion of migrant workers?

Are there areas where there are more migrant workers than average?



What are the Advantages of Employing Migrant Workers?


A blank canvas

The work ethic

Needs must

Promotion potential?



What are the Disadvantages of Employing Migrant Workers?


Poor language skills

How poor language skills have manifested themselves

Strategies for countering problems with language

The multi-national, multi-ethnic melting pot

The transient nature of the job



How is the Points-Based System Impacting on the Industry?


A8 boom may have given false picture

Market dynamics quite different from Australia

More misery for operators?

Ethnic sector to be particularly badly hit

Lower-grade kitchen staff biggest area of concern for ethnic restaurants

Other restaurants employing non-EU staff also face problems

Training provision in the UK: overlooked?



What do People Really Think About Immigration?

Key points

Figure 23: Agreement with statements about immigration, March 2008

Strong feelings and contradictory opinions about immigration

Commitment most important to younger people

Multi-cultural Britain: a generational thing

Worries about immigration peak among older people

Too many immigrants also concern for older people

Discomfort with large immigrant communities also an age/class thing

Younger people least likely to think about immigration

Clear correlation between tolerance and concerns about immigration

Figure 24: A greement with statements about immigration, by agreement with statements about immigration, March 2008

Average age

Figure 25: Average age of respondents, by agreement with statements on immigration, March 2008



Appendix: What do People Really Think About Immigration?

Agreement with ‘I worry about the level of immigration in the UK’, by detailed demographics

Figure 26: Agreement with “I worry about the level of immigration in the UK”, by detailed demographics, March 2008

Agreement with ‘It's nothing to do with me, I don’t think about it’, by detailed demographics

Figure 27: Agreement with “It's nothing to do with me, I don’t think about it”, by detailed demographics, March 2008

Agreement with ‘It is a good thing that Britain is such a multicultural society’, by detailed demographics

Figure 28: Agreement with “It is a good thing that Britain is such a multicultural society”, by detailed demographics, March 2008

Agreement with ‘As long as people are committed to the UK it doesn't matter what ethnic/national background they are from’, by detailed demographics

Figure 29: Agreement with “As long as people are committed to the UK it doesn't matter what ethnic/national background they are from”, by detailed demographics, March 2008

Agreement with ‘I don't feel comfortable in areas with large immigrant communities’, by detailed demographics

Figure 30: Agreement with “I don't feel comfortable in areas with large immigrant communities”, by detailed demographics, March 2008

Agreement with ‘There are too many immigrants in this country already’, by detailed demographics

Figure 31: Agreement with “There are too many immigrants in this country already”, by detailed demographics, March 2008

Abstract

Migrant workers have always been a key part of the eating out industry, traditionally providing a source of readily available labour, particularly in low-grade and unskilled positions, where there has been a shortage of UK residents due to a stigma on hospitality careers. With the accession of the so-called A8 countries, including Poland and Lithuania, in May 2004, there was a fresh and large influx of employees into the hospitality trade generally, which has facilitated the continued growth of the eating out market and enabled major chain operators to expand their estates.

It is now widely acknowledged within the industry that it could not operate without the significant migrant workforce underpinning its foundations. However, there is cause for concern on several fronts such as the fact that the number of people entering the catering sector from the A8 countries is declining. Furthermore a new immigration system is to be introduced shortly which threatens to force many existing non-EU restaurant staff to return home and will severely restrict operators’ ability to recruit people from countries outside the EU.

This report assesses the current status of the eating out industry in terms of its reliance on migrant workers, the factors that are driving the use of migrant workers and the growth of the industry. It also attempts to outline the trade’s perspective on a range of issues related to immigration, not least of which is the points-based system which threatens to severely destabilise the industry, particularly the ethnic restaurants sector, which derives the vast majority of its employees from non-EU countries. The report considers the hypothesis that ‘the major impact of immigration on the eating out industry has been at an operational level’ as opposed to creating opportunities for new restaurant formats targeting the immigrant community.

Main themes of the report:

  • Extent of industry’s reliance on migrant workers.
  • Potential slowdown in influx of migrant workers from A8 countries.
  • Reduction of pool of non-EU employees for industry in wake of introduction of points-based system.
  • Threat to long-term prospects for ethnic restaurants sector.
  • Need for more training in the UK to compensate for shortages.
  • Potential stimulation of eating out formats/menu flavours.



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