British Beauty Council unveils 2023 Value of Beauty Report

British Beauty Council CEO, Millie Kendall OBE, has revealed the findings of the 2023 Value of Beauty Report, alongside chief policy officer, Victoria Brownlie and COO Helena Grzesk MBE.

Conducted by Oxford Economics, the second Value of Beauty Report reveals that, in 2022, the personal care industry supported a total GDP contribution of £24.5 billion.

This figure is down from £27.2 billion in 2018.

The people economy

The report reflects that fact challenges presented by the pandemic meant the GDP contributions of the personal care industry fell by 28.1%.

However, is shows the industry is showing very promising signs of a recovery.

Just over half of this contribution (£12.3 billion) was generated by the industry itself, representing 0.5% of the nation’s GDP.

Through the wage payments made to the industry’s workers, a further £7.3 billion of economic activity was supported.

Employment and education

According to the report, the personal care industry employed 550,000 people in 2022 – and 379,000 of these jobs were supported directly by the industry itself: that’s one in every 50 jobs.

Hair and beauty services support direct employment of 209,000. This represents 1.1% of total jobs in the UK in 2022.

The industry also plays an important role in educating its workforce.

Beauty and personal care supported the completion of almost 80,000 recognised qualifications in the 2021/22 academic year.

“The challenge we have at the moment is converting the young people doing these courses to careers within the industry,” said Mille Kendall OBE, British Beauty Council CEO.

“We’re working hard to understand why this is happening and reverse the trend.”

Diversity and opportunity in beauty

The diversity of its workforce and high rates of entrepreneurship are hallmarks of the personal care industry. It employs four times as many women as men and has a younger workforce than the wider working-age population.

The reports says that although men are in the minority, those working within the industry are more diverse.

They are more likely to identify as being of an ethnic minority and to have a sexual identity other than heterosexual or straight.

Entrepreneurs play a hugely important role in the industry. Rates of business ownership in the beauty industry are reported to be almost three times higher than across the economy as a whole. And more than 80% of business owners are women.

A force for change

In common with many other sectors in the UK, the personal care industry has needed to adapt to include technological developments over the last decade.

British Beauty Council research identifies key themes around digitalisation. The growth of e-commerce as a sales channel in the UK is one.

ONS data that shows total e-commerce sales grew in the personal care sector. Revenue comes from online channels, which rose from 23% of total revenue in 2017 to 40% in 2022.

Another is the increasing use of Augmented Reality (AR) tools such as e-makeup and virtual try-on. These tools are popular with users, enhance consumer engagement and help contribute to sustainability.

Leveraging the reach of social media has become increasingly important for the sector’s marketing and influencers have established themselves as a potent marketing tool.

Evidence shows that 68% of marketers work with influencers and 88% of brands have a dedicated influencer budget.

Adverse effects of Brexit

The value of Beauty report states that businesses have faced huge operational challenges since the UK’s exit from the European Union.

Key impacts include increased trade barriers and a shortage of skills following changes to migration laws.

A survey conducted by the British Chambers of Commerce found that 49% of UK exporters reported facing difficulties thanks to changes required to trade goods following the UK-EU trade deal.

There is also evidence that the new trade barriers following Brexit have disproportionately damaged smaller businesses

This is especially harmful for the personal care sector, which is mostly comprised of small businesses.

Skills shortage

A shortage of skills following Brexit was also a concern identified, particularly for segments which previously relied on EU workers.

Oxford Economics analysis showed that 59% of full-time employees in the personal care industry earned less than the skilled worker visa earnings threshold in 2022.

This is compared to 33% of all employees in the UK.

“The whole point of the British Beauty Council is to inspire the next generation,” concluded Kendall.

“We urge people to sign up to be a Future Talent Ambassador and help us up skill the future generation.

“We are very focussed on ensuring there is a pipeline of investment coming into our industry and we will be doing something about it.”

Download the report here.

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