Impact of beauty industry on UK economy 'outstrips motor manufacturing'

Patrick Sawer
Two beauty vloggers talking about make up - E+

The selfie culture has helped the growth of beauty product sales to such an extent that the industry is now worth £30 billion to the UK economy, outstripping more traditional sectors.

A report published this month has found that the British beauty industry directly employs nearly 370,000 and supports another 220,000, more than those employed in the law and social work sectors.

The Value of Beauty, commissioned from Oxford Economics by the newly-formed British Beauty Council, argues that until now the contribution of the beauty industry has been underrated and wrongly regarded as peripheral to the economy.

The report, the first of its kind to examine in detail the scale of the beauty sector, claims it makes a bigger contribution to the UK’s gross domestic product (GDP) than even motor manufacturing or publishing.

It cites figures from the Office for National Statistics showing that while motor manufacturing in the UK makes a direct contribution of £13.5 billion to the economy, the direct contribution of beauty retailers, manufacturers and advertisers was £14.2 billion last year.

That rises to £28.4 billion when indirect contributions such as the wages spent by beauty workers in the wider economy are taken into account, the equivalent of 1.3 percent of the UK’s total GDP.

Two social media 'influencers' discussing beauty products Credit: martin-dm/E+

The explosion in online shopping and the phenomenon of sharing images on social media has contributed to the huge growth in the use of beauty products and treatments, say industry insiders.

They point out that a survey carried out a decade ago estimated the worth of the beauty industry at £18 billion, compared to the £27.2 billion in 2018 found by Oxford Economics.

Millie Kendall, CEO of the British Beauty Council, said: “The visual aspect of social media has certainly contributed to people using more beauty products, and the sale of those products on line has seen a tremendous growth in sales.

“Combining those two aspects is the impact of social media ‘influencers’, who have played a great part in the spread of particular beauty products to more and more people.”

A woman receiving ultrasonic and laser face treatment at beauty salon Credit: Gregor Bister/Getty Images 

Ms Kendall said it was time the serious contribution of the beauty industry to the economic well being of the country was recognised.

“Beauty is a force for good both in the UK and globally. Our Value of Beauty report is a crucial first step in achieving recognition for the huge impact the beauty industry makes to the UK economy. Longer term, it’s about changing the reputation of beauty so that it’s recognised as the positive, dynamic and successful industry that it so clearly is. We don’t want to be fluffy any longer,” she added.

The report found that the beauty industry supported a total of 590,500 jobs in 2018, equating to one in every 60 jobs in the UK economy, and similar to the total number of people employed in Birmingham last year.

It also found that the beauty industry contributed £7 billion in UK tax revenues, equivalent to the combined salaries of 250,000 nurses and midwives.

The authors argue that the contribution of the industry has had a significant effect on the health of the high street through the presence of beauty salons, hairdressers and nail parlours.

While the number of retailers of beauty products has fallen by 169, in part due to the growth of online sales, the number of service providers in the beauty sector has grown by 1,394.

The report was welcomed by major industry figures. 

Annie Murphy, chief commercial officer of the retail giant Walgreens Boots Alliance (WBA) said: “The Value of Beauty report has shone a bright light on the fantastic contribution to employment in the UK that the Beauty industry is making. 

“The sheer scale is really impressive, as is the diversity of the employees working across the

industry in age, gender, ethnicity, sexual orientation. We are proud to be a highly-inclusive industry with opportunity for all.”