Economies of Ale Part Two: How the Pub is Evolving

Earlier this week I blogged about the new ONS data which shows an end to – or at least pause in – the decline in pub numbers. Digging deeper into the research, here are a few more facts and wrinkles the data reveals.

The pub is entirely a product of British culture. It is a fundamental cornerstone of British society – no longer as absolutely central as it once was, but still a key trait that identifies us a nation, to ourselves and others.

As I said in my previous post on the new ONS research (and first said in Man Walks into a Pub) as a creation of our culture, the pub reflects ourselves back to us. As our culture and society changes, so must the pub, if it wants to survive.

The core of the ONS research has been put together from data on licences provided by local authorities, so we can break it down to see what happens in different parts of the country, making some informed guesses about what’s driving these changes. There’s also some other data sources they’ve used to add some colour to the picture. Here are a few snippets that I find particularly interesting.

We’re not really drinking more at home – we’re just drinking less in the pub (even though we’re eating out more.)

Numbers about the on- versus off-trade are usually presented as percentage split: in 2000 we drank 34% of our total beer at home, and 66% of it in pubs, bars etc. In 2018, we only drank 46% of our beer out of the home, and 54% of it in-home. It would be reasonable to assume then that we’re swapping pints in the pub for cans on the sofa.

But when you look at it in terms of what we actually spend, the amount we’re spending on drink in the home hasn’t risen anywhere near as much as the amount we’re spending in pubs had fallen. In fact, we’re spending the same proportion of our income on alcohol for home consumption now – when in beer terms, that accounts for 54% of all the beer we drink – as we did in 2001, when it accounted for 34% of all the beer we drink.

Wine makes up a bigger proportion of what we drink at home. Also, when we eat out – which, as you can see, we’re doing a lot more of – we’re also more likely to choose wine over beer. That’s why wine now accounts for 31% of all the alcoholic units we drink, up from 25% in 2001, while beer has fallen from 47% to 36% of what we drink over the same period. So the whole debate around the supermarket pricing of beer is less important for pubs than we might think – we’re not swapping pub beer for supermarket beer; we’re drinking less beer, and more wine. If we want to stop beer’s decline, the best thing to do would be a lot more work positioning beer as a good accompaniment to food.

Pubs are getting bigger, and employing more people

Having just looked at the difference between percentages and absolute numbers, what’s interesting here is that both tell the same story: the overall number of pubs has fallen massively. But the number of large and medium-sized pubs has actually grown. In 2001, three-quarters of British pubs employed fewer than ten people. A massive four out of ten small pubs have disappeared so far since then. Given that these are the pubs we often think of when we imagine the British pub – the quiet, cosy little boozer – this means the picture is even scarier than we might have thought.

But overall, the data shows just how wrong people are getting it when they talk about the death of the British pub, as opposed to a fundamental change in its character. Large pubs (employing 25 people or more) have almost doubled in number over the period, more than doubling their share of the market. The knock-on effect of this is that even though we have far fewer pubs than we used to, there are now actually more people working in pubs than there were in 2001: 457,000 now, compared to 439,000 then. The average pub now employs twelve people overall, compared with eight in 2001.

Both this increase in overall employment and the increase in the average size of the pub can be explained by food: in 2003, 43% of people employed by pubs worked behind the bar, compared with 28% working in food service (which includes chefs, cooks, waiters, waitresses, and kitchen and catering assistants.) Now, fewer than one in three pub staff work behind the bar, but 44% work in food service.

The picture is massively different across the country – but this has more to do with what a place is like than where it is.

The picture of pub closures this century is almost universally grim – but not quite. Out of 391 local authorities included in the data, 358 have seen a fall in the number of pubs there, while 16 have seen no change, and 17 have seen a growth in pubs – in some case, substantial growth. We can infer quite a bit about the dynamics of the market by looking at both extremes.

The worst-hit boroughs are an absolute bloodbath:

• Barking and Dagenham has lost 67% of its pubs between 2001 and 2019

• Newham has lost 57%

• Luton has lost 55%

• Burnley has lost 53%

Why? Well, one thing all these areas have in common is that they have a high proportion of ethnic communities who for religious and cultural reasons don’t drink alcohol. Over the course of the 21st century, while the ethnic population as a whole may or may not have increased all that much, the children of people who moved there earlier have grown up and replaced a cohort of young people who used to spend a lot of time in pubs with a cohort of young people who don’t.

But that’s not the only reason. 7.2% of adults in Barking and Dagenham are unemployed – almost double the national average. A further 31% of working adults earn less than the London living wage. In Newham, unemployment is 6%, while 32% of people earn less than living wage – the highest rate in London. The figures are similar for Burnley and Luton, and also for places like Bolton, Blackburn and Barnsley, where unemployment is higher and wages lower than the national average.

But even this doesn’t explain the full picture: places like Croydon (52% of pubs lost) and Slough (50% of pubs lost) also feature in the worst-hit areas. Croydon is commuter central, and Slough has one of the lowest unemployment rates in the country. But these are the kinds of places where ‘development’ has seen real estate prices shoot through the roof, and chains displacing small, independent businesses. Economic boom and economic slump: both have been bad news for pubs over the last twenty years.

But as I mentioned, there have also been winners:

• West Somerset has seen a 25% increase in the number of pubs – the most of any region in the UK. Numbers have also grown in the Scottish Highlands and stayed stable in the Western Isles, confirming that tourism plays a key part in keeping pubs alive. This gets even more apparent when you split the data by number of pubs per capita. West Somerset, the Cotswolds, South Lakeland, the Derbyshire Dales, North Devon, West Dorset and Stratford-upon-Avon all have more than one pub for each person who actually lives there, and have only seen a fractional fall – or an actual increase – in the total number of pubs.

• The London Borough of Hackney has the third biggest growth in the number of pubs of any borough in the country. It’s surely a coincidence that the number of pubs in Hackney has grown by 23% since I moved here in 2001 – but not entirely so. This is a borough that has gentrified, but not too much – at least not yet. When I moved here, a large number of Windrush-era, elderly Caribbean people were selling houses they had bought for nearly nothing to younger, more affluent middle class people, and retiring back to the sun to buy mansions and hillside estates with the proceeds. Property prices ahve now increased at least five-fold, but since then, there’s been a huge influx of Millennials and Gen-Z renters who can never hope to buy here, who live crammed into flats where living rooms have been turned into extra bedrooms, many with flatmates rather than best mates, and so they spend most of their money out of the home, in coffee shops, pizzerias – and pubs. Take the piss out of the hipster sitting ostentatiously at the window in front of their laptop all you like, but in some parts of the country, that hipster is keeping pubs alive.

So what can we learn from all this? The deeper you dig into the data, the more clues it reveals. Some of the inferences I’m making may be off the mark, or I may be missing something big, but even if that’s the case, I think the one thing that is beyond doubt is that it would be foolish for anyone to make sweeping generalisations about the nature and causes of Britain’s pub decline. The picture looks different wherever you go, and even where the picture is similar, when you look at the demographics and economics in a particular place, the reasons for pub closures may be quite different. And so, wherever you look, the solutions are probably different too.

If you want to check how your borough compares with the national average, just click here.

I’ll close this long, statty blog with my favourite quirk from the data, which, if you’re feeling sadistic, would form a perfect pub quiz question or two:

Q: Which local authority in the UK has the highest number of pubs per capita?

A: The City of London, which has an incredible nineteen pubs for every person who lives in the borough.

How does that happen? Well, between 500,000 and a million people work in the City of London, but fewer than 10,000 actually live there. At 6pm on a weekday, every single pub is standing room only. By 9pm, most of them are closed and shuttered for the night.

Here’s a follow-up:

Q: Which local authority has seen the steepest fall in the number of pubs per head this century?

A: The City of London. In 2001, there were TWENTY-SEVEN pubs for each person who lived there.

What happened?

In 2007, there were still 26 pubs per head. In 2014, that number hadn’t really fallen the financial crash – which you might ave expected ton have seismic effects – didn’t make any difference to the boozy habits of the financial sector. But maybe the long-term repercussions did.

From 26 pubs per head in 2014, the number collapsed over the next five years to 19 in 2019 – the sharpest fall of anywhere in the country, by some way. And while perhaps few of us can muster up much sympathy for the people who first caused the financial crash and then profited handsomely from it while most of us still remain worse off than we were before, the reasons behind this massive fall show how quickly social engineering can take effect: I blogged in 2017 about how Lloyds of London had just made lunchtime drinking a sackable offence. This was obviously just part of a broader shift in attitudes that sees alcohol becoming a bugbear – even as we are drinking less, we perceive it to be a greater threat than ever. That has just happened in extremis in the City. Combined with the kind of ‘development’ that is seeing any hint of personality, individuality and local history erased by characterless steel and glass tower blocks, each with its own mandatory Tesco Metro, Costa Coffee and Pret à Manger, we can see that the biggest, swiftest decimation of pubs can always come from an angle no one is guarding. That’s ‘progress’ for you.