This morning I spoke in the ‘Beauty and wellbeing sector workforce’ debate led by my Welsh Labour colleague Carolyn Harris MP. I paid tribute to all those businesses in Newport East – hair, beauty, therapeutic and nail salons for adapting and innovating in incredibly challenging times during lockdowns to meet new regulations.
With a gap between revenue and overheads we need fair economic measures to help support these businesses to recover and thrive. These are valuable businesses not just for our mental and physical wellbeing but for the economic contribution they make to our high streets as employers.
Here’s my speech from the debate:
Well done to my hon. Friend the Member for Swansea East (Carolyn Harris) for securing this important debate, and for all her dogged campaigning with my equally hon. Friend the Member for Bradford South (Judith Cummins) on behalf of the beauty sector over a year of enormous challenges.
I put on record my support and admiration for all the hair, beauty and therapeutic businesses in Newport East, which, like many businesses out there, have been hard hit at this extraordinary time and have had to adapt and innovate very creatively in lots of instances in the pandemic. I pay tribute to business owners such as Lynne Palmer of Friends salon in Maindee. She has run her business for decades in the heart of the community—I will come back to that point—and has helped me to understand just how challenging it has been to adapt. She has marvellously adapted to adhere to the rules and to keep giving her customers the wonderful service she provides, but she has also helped me to understand how challenging that has been. I very much agree with the right hon. Member for Romsey and Southampton North (Caroline Nokes) and my hon. Friend the Member for Swansea East about entrepreneurial women in small businesses and about the guts it takes to set up and run a business and employ others.
As has been said, the hair, beauty and products industry is a serious economic powerhouse, contributing more than £30 billion to the economy and employing more than 500,000 people in thousands of salons, nail bars and beauty salons up and down our high streets, forming a real linchpin in local economies. In 2018, the industry generated £7 billion in taxes, and accounted for around 1.3% of GDP. As has been said, the National Hair and Beauty Federation report released last month makes for stark reading on how the industry has suffered through the pandemic. In 2020, salons were shut for 140 days. Turnover fell by 45% compared with 2019, and the average cash loss to a business was £17,000, with those over the VAT threshold taking a bigger hit.
In Wales, there has been welcome help from the Welsh Government, including the freezing of business rates, the small business rate relief package and the £650 million the Welsh Government offered to help businesses with operation costs up to the end of March. As my right hon. and learned Friend the Member for Holborn and St Pancras (Keir Starmer) highlighted at Prime Minister’s questions last week, unlike in England, where business rate relief is being withdrawn at the end of the month, the Welsh Labour Government are extending that rate relief for a year and providing new support for those affected.
Furlough has been welcome, but salons in my constituency and across the UK have called on the Chancellor to take action on the reduced 5% VAT rate to put businesses in the beauty sector on a level playing field with other sectors, such as hospitality. Many businesses in my constituency have signed that petition, and I am interested to hear the Minister’s response. Without comprehensive support, many businesses may close.
National Hair and Beauty Federation research shows that there are more hair and beauty businesses in the less advantaged parts of the UK. Throughout the pandemic, communities in less well-off areas, as well as women and young people, have been disproportionately impacted. That is highlighted in Wales by Chwarae Teg in its report “Covid-19: Women, Work and Wales”, which was published last October. The effect of the sector’s shutdowns, business closures and unemployment is falling disproportionately on women, who are more likely than men to have lost their jobs due to covid-19. There are clearly challenges around female employment.
As my hon. Friend the Member for Swansea East said, a recent survey of 5,000 salons found that 62% were not sure if their business would survive beyond the end of the financial year, with 18% sure they would close. Six out of 10 salons started the year with no cash reserves, and many businesses are now described as acutely vulnerable to failure. Those are businesses that generate much for the Treasury. They pay tax and they are vital employers in our community. As my hon. Friend said, it is also important to remember the impact of the cancellation of events, weddings in particular, on the hair and beauty industry.
Finally, the value of the beauty sector cannot be measured in economic terms alone. I hope parliamentary legal counsel, Daniel Greenberg, who is a regular contributor to “Thought for the Day” on Radio 4, will forgive me, but I would like to quote from one of his thoughts last year. He talked about how the restrictions imposed during national lockdowns taught us to distinguish between two types of essential:
“There are things that I need to remain physically healthy: food, medicines and healthcare services. But there are also things that I need to remain mentally healthy, and those go far beyond what might be regarded as the formal mental healthcare sector…Lockdown may have taught us to reclassify as luxuries some things we thought of as essential, but perhaps it has also shown that some things that are luxuries in one sense may be essential to people’s wellbeing…Nail salons and other beauty sector services aim to help people to feel better about themselves, and to make customers generally more cheerful and well-disposed…Perhaps we can see more clearly post-lockdown that these services are in what might be called the frontline of the well-being sector, and that they deserve society’s recognition, gratitude and appreciation.”
I and a great number of my constituents would totally endorse that sentiment. Thanks again to all those beauty and hair businesses in Newport East. On a few occasions over the past year, flippant comments from those on the Government Benches have been unfortunate. The beauty sector needs to be put on a level playing field and supported as a key player in the UK Government’s economic and health-centred recovery from the pandemic. Hon. Friends are here to speak up for the industry, and I hope the debate has underlined the importance of doing so.