The UK’s retail, hospitality and leisure sectors are dealing with mounting strain because the ripple results of President Trump’s world tariff insurance policies proceed to destabilise commerce and drive up prices — regardless of a brief 90-day pause on new duties.
Amanda French, companion and head of retail and leisure at nationwide legislation agency Clarke Willmott LLP, warns that the sector is grappling with extended uncertainty, notably as the specter of renewed US tariffs and the continued commerce conflict with China loom giant. “Retailers were already dealing with an additional £5.6 billion in costs from the October Budget, driven by rises in the National Living Wage, National Minimum Wage, and employers’ National Insurance contributions,” mentioned French. “For an industry heavily reliant on part-time, lower-paid staff, the changes to NIC thresholds — now applying on earnings above £5,000 — equate to an added cost of around £615 per employee, before factoring in wage increases.”
Enterprise charges are one other strain level. Some properties are anticipated to see their charges practically double, whereas the retail, hospitality and leisure aid, which offered a 75% low cost since 2020/21, will now be diminished to simply 40%.
Whereas Trump’s determination to delay the imposition of larger tariffs on international locations together with the UK affords “some welcome breathing space,” French says the reprieve is more likely to be short-term. “There remains deep uncertainty about what happens after the 90-day pause, especially as the US continues its tit-for-tat trade battle with China. That leaves UK businesses facing not only volatile supply chains, but also rising operational costs and shifting consumer behaviour.”
A current survey by the British Chambers of Commerce discovered that 62% of UK companies with commerce publicity to the US anticipate to be negatively impacted by the tariffs — a major variety of which fall throughout the retail, hospitality and leisure industries. “Many of these businesses will be forced to raise prices to absorb costs,” French added. “Ultimately, it’s consumers who will pay the price in what is already a challenging economic climate.”
As UK companies brace for what could lie past the tariff pause, trade leaders are calling for higher readability and focused help to assist climate the rising storm — or danger seeing long-standing sectors squeezed even additional.
