Chris Gray reports from the Hays Travel Homeworking one-day conference held at the Marriott Forest of Arden Hotel in the midlands

BRITAIN is facing a “bathtub-shaped” recession from which it will not recover for a decade, Hays Travel boss John Hays (pictured) has warned.

The north-east-based firm’s managing director predicted the economy would “bump along the bottom” of the bathtub before starting to climb out in 10 years’ time.

Next year would be difficult as the government would have to stop pouring money into the economy and taxes would have to rise, he said, but travel would fare better than most sectors in the long term.

Even if unemployment rose to 10%, the 90% of people in work would have more disposable income because of low inflation and interest rates, and would still take holidays, he said.

Speaking to TTG at the Hays Travel home-workers’ conference, Hays said next year would create opportunities for the company as its cash reserves meant it could buy struggling retailers.

“It’s going to be a bathtub-shaped recession and we will bump along the bottom for a decade,” he said. “So I’m not optimistic about the economy in general. But for Hays Travel we have made the right decisions, got good technology and people, and a strong balance sheet.”

He said when the recession hit Hays in September last year it was “like turning the lights off” because trading went from being well up on the year before, to 25-30% down overnight.

The firm responded by shelving plans for its Hays Faraway tour operation, scrapping a pay rise due in April and making 12 people redundant – the first redundancies in its 30-year history.

However, no shop staff lost their jobs and all staff are getting a pay rise of up to 3% this month after trading took off again in July.

October trading was 40% up on the same month last year when the recession was hitting home. More significantly, it was 10% up on October 2007, when trade was healthy.

Hays predicted more growth in 2010 for the Hays Independence Group, demonstrated by the recent addition of 1st4cruising. He said the homeworking division would potentially expand if agents from other shops that went bust decided to set up as homeworkers, and he predicted Hays’ retail estate would grow.

“We have a strong balance sheet. There are other companies in distress and we are evaluating acquisitions. I’m optimistic for 2010,” he added.

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