There’s no denying the past few years have been tough on Sydney’s hospitality industry, but things are looking up.
The industry is already bouncing back, plus emerging market trends and some new government initiatives are also giving business owners a few very reasons to smile in 2022.
Lockdown and lockout laws are history
The lockout laws imposed on Sydney’s nightlife by the NSW Government in 2014 had a disastrous impact on Sydney’s bars, clubs, hotels and entertainment venues; roughly 176 businesses closed, and the city lost approximately AU$16 billion in revenue without having any meaningful impact on crime. Fortunately, these laws were repealed in March 2021.
Unluckily for hospitality businesses, the repeal of these laws came about during a year of new variants and intermittent COVID-19 lockdowns.
For Sydney’s hospitality industry, social distancing regulations and the spread of OMICRON had a double impact on business. In the first instance, dining and entertainment has been heavily restricted and businesses have struggled with staffing and financially to stay open during lockdowns.
Secondly, with many people working from home the Sydney CBD practically became a ghost town in 2021. Retail and hospitality businesses in the inner city were badly affected, while conversely many cafes in the suburbs received a boost in customers.
Thankfully, lockout and lockdown restrictions are now a thing of the past, and COVID-19 is on the decline in NSW. This year is officially the first year since 2014 where the Sydney hospitality industry is not being held back by any localised government restrictions on business compared to other Australian cities, and CBD businesses are feeling optimistic as a result.
Borders have reopened bringing back international visitors
International tourism plays a critical role in supporting the hospitality industry in Sydney, particularly in the inner city and CBD. During 2020, when international borders closed, overall spending by visitors in Sydney roughly halved, dropping from AU$19.7 billion in 2019 to AU$9.5 billion in less than a year.
Hospitality and tourism operators breathed a big sigh of relief when the Federal Government finally announced the lifting of international border closures earlier this year. Michael Johnson, CEO of Tourism Accommodation Australia is optimistic about tourism coming back, telling Bloomberg earlier in 2022, “Our biggest influx of internationals are more likely to be in the latter part of the year.” A number of big hotel developments are underway in expectation of the boom to come, including a $760 million revamp of the Tattersalls Club on Pitt St, in Sydney’s CBD.
“As people start to travel both internationally and interstate again,” ICD Property senior development manager Simone Gervasi told The Urban Developer Magazine earlier this year, “we envisage occupancy rates will come back to pre-Covid conditions within Sydney particularly, and eventually grow and thrive and increase as they had been for years prior to Covid.”
Government plans for CBD revitalisation and a 24-Hour City
The City of Sydney and NSW Government have plans underway to inject some new life into the CBD, support arts and culture as well as giving a boost to hospitality businesses Sydney-wide.
- The City of Sydney will be offering $4 million in grants to support public events and boost creative and cultural precincts across the city.
- This year, the NSW Government is implementing a new ‘24 Hour Economy’ strategy to support the reopening of CBD and inner-city nightlife, entertainment, dining and cultural activities.
- The City of Sydney has now approved hundreds of new Al Fresco dining and outdoor entertainment licences that were created as part of a strategy to support hospitality business during the pandemic. These low-cost licences are now here to stay.
- As part of the 24 Hour Economy, the NSW Government has created a CBD Revitalisation Program which offers funding to local businesses, councils and events, assisting them in attracting visitors and engaging with the community.
Events supported through these programs such as the recent Laneway Festival have already proved the success of this model in bringing people back out into the Sydney CBD.
Looking towards the longer term, a number of large-scale urban renewal development projects were approved late last year, including; the construction of Sydney’s own CBD Silicon Valley, ‘Tech Central,’ upgrades to Belmore Park, Chinatown and Townhall to include more public space, and a laneways revitalisation program. These projects are all good news for hospitality businesses in central Sydney.
Consumers are itching to dine out regularly again
Consumer studies are showing that diners can’t wait to get off the couch and back into the restaurant. A recent OpenTable survey of Australian diners showed that at least 70% of them have returned to their pre-COVID dining habits, and 67% of respondents eat out at restaurants at least once a week.
Some trends established during the pandemic appear to be the new normal. Al Fresco dining continues to be popular among 81% of diners surveyed, while a majority of consumers also want their favourite restaurants to continue offering takeaway.
National hospitality recovery looking good
Released in November 2021, the “Staying Open: Future-Proofing Aussie Hospitality” report shows that the national hospitality sector started to make a comeback as soon as restrictions were eased.
Although businesses continue to face staffing shortages, overall the industry proved to be highly resilient and is adapting to the post-pandemic environment. The report shows that the industry is now undergoing arguably necessary reform in areas, such as benefits and childcare, and early indicators paint a positive outlook for the future as tourism and business resumes in full.
Careers in hospitality
The hospitality industry in Sydney and across Australia right now is in sore need of skilled employees. With some of the best restaurants, bars and hotels in the world studded along the shining harbour-side of one of Australia’s most stunning cities, the hospitality industry in Sydney certainly has a lot to offer.
It’s a great industry to work in with many diverse and flexible career paths. If you want a fantastic, lifelong career and a fast-track to a management position, you may want to consider a university qualification.
Torrens University Australia offers a range of hospitality courses that come with a strong industry placement program where students earn money in the industry while studying. Graduate with work experience and a qualification that can set you up to jump straight into a rewarding career in hospitality management.