Two-fifths (41%) of hospitality and leisure businesses have experienced an increase in post-work footfall in the past year, with 35% reporting busier weekday lunchtimes, new data shows.
According to Barclays Business Prosperity research, while consumer spending has largely remained muted in many sectors amid the cost of living crisis, the hospitality and leisure sectors have “continued to perform strongly, outpacing growth in other non-essential categories since April 2021”.
It comes as consumers are prioritising experiences over material purchases. Barclays Consumer Spend data found the average monthly spend on entertainment and travel has consistently outpaced retail in the past four years.
As a result, 83% of hospitality and leisure businesses are investing in consumer experiences, with 52% of this group implementing technology to make their offering more experiential and 51% introducing competitive socialising.
Other investment focuses include integrating AI into service delivery processes, expanding into new markets, investing in employees, reshaping offerings to meet evolving customer needs and investing in premises.
Almost half (46%) have seen an increase in revenue due to this investment.
Despite this, Barclays noted many businesses in these sectors continued to experience challenges including energy and tax costs, and tariff increases.
Earlier this month, UKHospitality warned the UK government the sector was in danger of being “taxed out” as a result of the 2024 budget.
Between October 2024 and May 2025 the hospitality sector lost 69,000 jobs, according to the trade association. In the same period the previous year, hospitality created an additional 18,000 jobs.
To help mitigate these pressures, Barclays said 40% of businesses were making use of special offers and promotions, while 36% were expanding distribution channels and 26% were extending their opening hours.
“Hospitality and leisure businesses are benefitting from increased footfall as more workers return to the office which, combined with the rise of the experience economy, is contributing to optimism for future growth,” said Barclays head of hospitality and leisure Rich Robinson.
“It’s no longer just a trend that consumers are choosing memories over material goods – our data shows it’s a fundamental shift in how they determine their financial priorities. Hospitality and leisure businesses are able to capitalise on this and play to win by delivering unforgettable experiences for customers.”
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