Dublin: The Restaurants Association of Ireland (RAI) has issued a stark warning following the release of its Cost of Doing Business 2025 survey, revealing mounting financial strain across the restaurant and hospitality sector. Based on responses from over 170 business owners, the report shows that 65% experienced a decline in financial performance in 2024, with operating costs surging and margins tightening.
The sector saw 150 closures in the first quarter of 2025 alone, driven by rising payroll costs—now nearly 39% of turnover—alongside significant increases in food, insurance, and utility expenses. Full-time and part-time staffing levels have fallen by 10% and 7%, respectively, while ingredient costs have soared, with beef up 96%, chocolate 157%, and energy costs nearly doubling since 2022.
RAI CEO Adrian Cummins described the situation as a “red alert”, calling for immediate government action, including the restoration of the 9% VAT rate. Without intervention, Cummins warned, more closures and job losses are inevitable, especially in rural communities where closures often prove permanent.
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