Accommodation and Food Service Activities

Sector scope 

 

This report covers NACE Rev. 2 Section I: Accommodation and Food Service Activities, including hotels, tourist accommodation, restaurants, cafés, catering and related food-service businesses. In the EU, the sector is structurally important but fragmented: in 2022 it employed 10.9 million people, represented 6.8% of EU business-economy employment, and included around 1.96 million enterprises; food and beverage services accounted for 79.4% of enterprises and 76.8% of employment within the sector. 

 

1. Sector context and sustainability relevance

 

The sector is closely linked to tourism, urban economies, rural destinations, food systems, real estate, transport and local employment. Demand has recovered strongly after the pandemic: EU tourist accommodation establishments recorded more than 3 billion nights in 2024, and Eurostat’s early estimates show 3.08 billion nights in 2025, the highest level recorded. This growth strengthens the sector’s economic contribution but also increases pressure on energy use, water consumption, food waste, packaging waste, labour conditions, destination carrying capacity and local communities.

 

From a sustainability perspective, the sector has a dual character. Accommodation businesses are strongly exposed to building-related emissions, heating and cooling needs, laundry, water use, guest mobility and procurement. Food-service businesses are exposed to food sourcing, food waste, refrigeration, cooking energy, packaging, labour intensity, health and safety, and supply-chain risks. The EU Ecolabel for tourist accommodation explicitly identifies reduced energy consumption, water consumption, transport emissions, waste and food waste as core environmental priorities for accommodation providers. 

 

2. Environmental sustainability performance

 

The main environmental impacts of the sector arise from energy use, water consumption, food waste, solid waste, refrigerants, laundry operations, single-use packaging, procurement of food and beverages, and indirect emissions from guest travel. Hotels and restaurants are not usually among the largest direct industrial emitters, but their cumulative impact is significant because the sector consists of many small establishments and operates daily, often with high heating, cooling, refrigeration and hot-water demand.

 

Energy efficiency is one of the sector’s most important decarbonisation levers. Hotels, restaurants and catering facilities should prioritise building insulation, heat pumps, efficient boilers, smart thermostats, LED lighting, efficient kitchen equipment, refrigeration maintenance, renewable electricity procurement and on-site solar where feasible. The EU Tourism Transition Pathway frames the green transition of tourism around sustainable tourism, circularity, resilience and digital transformation, which directly applies to accommodation and food-service operators.

 

Water use is especially material for hotels, resorts, spas, laundries, kitchens and destinations facing seasonal water stress. Key actions include low-flow fixtures, greywater reuse where legally permitted, towel and linen reuse programmes, water-efficient dishwashing and laundry systems, leak detection, drought-resistant landscaping and supplier engagement. These measures are particularly important in Mediterranean destinations, where tourism peaks often coincide with summer water scarcity.

 

Food waste is one of the most material sustainability issues for restaurants, hotels and catering. The European Commission cites UNEP’s 2024 Food Waste Index, which estimated 1.05 billion tonnes of global food waste in 2022, with 28% from food services and 12% from retail. In the EU, the 2025 amendment to the Waste Framework Directive introduced binding national food-waste reduction targets for 2030; the European Parliament states that targets include a 30% per-capita reduction for retail, restaurants, food services and households compared with the 2021–2023 annual average. This makes food-waste measurement, menu planning, portion control, donation systems, inventory analytics and kitchen training strategic compliance and cost-control priorities.

 

3. Social sustainability and labour conditions

 

The sector is labour-intensive, service-oriented and highly dependent on seasonal, young, migrant and lower-wage workers. Eurostat shows that the sector’s employment contribution is much higher than its value-added contribution, and its wage-adjusted labour productivity ratio in 2022 was 124.9%, below the EU business-economy average of 152.6%. This indicates structural pressure on wages, productivity and margins.

 

Labour shortages remain a central risk. The European Labour Authority’s 2024 labour-shortages work identifies hospitality as one of the areas where shortages have persisted for years, while OECD Tourism Trends and Policies 2024 notes that job vacancy rates in accommodation and food services remained higher than in 2019. Sustainability strategies therefore need to include fair wages, predictable scheduling, career progression, training, occupational health and safety, migrant-worker protection, anti-harassment policies and employee retention.

 

Health and safety risks include burns, cuts, slips, ergonomic strain, cleaning-chemical exposure, heat stress in kitchens, psychosocial risks, violence or harassment from customers, and fatigue from long shifts. EU-OSHA materials on HORECA highlight the importance of risk assessment and worker protection in hotels, restaurants and catering. 

 

4. Governance, regulation and reporting

 

The sector is increasingly affected by EU sustainability regulation even though many businesses are SMEs. Large hotel groups, listed restaurant chains and major catering companies may fall under the Corporate Sustainability Reporting Directive depending on size and listing status, while smaller suppliers are increasingly affected indirectly through customer and lender expectations. The EU Ecolabel criteria for tourist accommodation, established under Commission Decision (EU) 2017/175, provide a practical framework for environmental management, renewable energy, energy and water saving, waste reduction and local environmental improvement. 

 

Greenwashing risk is also rising. Accommodation providers often market “eco”, “green”, “local” or “sustainable” services, but these claims need evidence through measurable indicators, credible labels, transparent procurement standards and verified emissions or waste data. For food services, sustainability claims around local sourcing, organic products, plant-based menus, animal welfare and food-waste reduction should be documented and auditable.

 

5. Key sustainability risks

 

The sector’s most material sustainability risks are rising energy prices, climate-related heatwaves and water scarcity, stricter food-waste obligations, labour shortages, reputational risk from poor employment practices, overtourism, biodiversity pressure in sensitive destinations, supply-chain volatility in food commodities, and compliance risk from misleading sustainability claims. Short-term rentals also create destination-level sustainability concerns: Eurostat data reported by Reuters showed 123.7 million nights booked through major online short-term rental platforms in the EU in Q1 2024, a 28.3% year-on-year increase, intensifying debates around housing availability and tourism pressure in some cities. 

 

6. Recommended sustainability KPIs

 

Accommodation businesses should track energy consumption per guest-night, Scope 1 and Scope 2 emissions per guest-night, renewable electricity share, water consumption per guest-night, waste generated per guest-night, food waste per cover or guest-night, laundry intensity, single-use plastic elimination rate, local and certified procurement share, and guest participation in sustainability programmes.

 

Food-service businesses should track energy consumption per meal served, food waste per meal served, edible surplus donation volume, share of plant-based or lower-carbon menu items, local/seasonal procurement share, certified sustainable seafood or agricultural inputs, packaging waste per transaction, recycling and composting rates, employee turnover, training hours, injury frequency and wage fairness indicators.

 

7. Strategic recommendations

 

The sector should move from isolated “green practices” to integrated sustainability management. Accommodation providers should implement formal environmental management systems, set science-aligned energy and emissions targets where feasible, retrofit buildings, procure renewable energy, reduce water intensity, measure food waste daily and integrate sustainability into guest communication. Restaurants and catering companies should redesign menus around seasonality, reduce overproduction, improve inventory forecasting, expand food donation partnerships, cut single-use packaging and train kitchen teams on waste prevention.

 

At sector level, the most effective transition pathway combines decarbonisation, circularity, decent work and destination stewardship. This means that sustainability should not be limited to environmental efficiency; it should also address fair employment, inclusive career pathways, accessibility, local sourcing, community acceptance and resilience to climate change.

 

8. Overall assessment

 

The European Accommodation and Food Service Activities sector is economically significant, employment-intensive and central to tourism recovery, but its sustainability maturity remains uneven because it is highly fragmented and SME-dominated. The strongest immediate opportunities are energy efficiency, renewable electricity, food-waste reduction, water management, sustainable procurement and improved labour conditions. Regulatory pressure is increasing, especially around food waste, environmental claims and sustainability reporting. Businesses that build reliable data systems, adopt credible standards such as the EU Ecolabel, and integrate sustainability into operations rather than marketing alone will be better positioned for compliance, cost reduction, talent retention and long-term competitiveness.