Many thousands of businesses in the experience economy are now at risk of failure, employers' group Ibec has said.

It made the warning as it launched a major new campaign aimed at improving understanding of the importance of the experience economy, which it claims has borne the brunt of the Covid crisis.

The organisation said the experience economy, encompassing hospitality, retail, travel, food, drink, tourism and entertainment, as well as aspect of the arts, cultural, sporting and heritage sectors, requires far more assistance from the state than it has received so far.

"These businesses need far greater certainty than what has been provided to date," said Ibec Director of Membership and Sectors, Sharon Higgins.

"Government must set out as much detail as possible on how it will support businesses and jobs in the sector over the medium-term."

"The business supports delivered by Government in response to Covid have been largely effective in preserving firms and supporting employees."

"However, the length of the public health restrictions has meant that business debt levels have risen sharply. Unless further measures are taken both before and in line with reopening, large scale business failures and redundancies are inevitable."

Before the pandemic hit last year, the experience economy employed 330,000 people directly or indirectly, Ibec says.

In 2019, one in every three euros spent by households was spent in the experience economy sectors, compared to one in every four on average in Europe.

€4bn is spent by the experience economy every year on purchases of goods and services, including over €1bn in purchases from domestic food and drink supplies.

"There are few places across the island of Ireland that are untouched by the experience economy," said Ms Higgins.

"The benefits of this diverse industry are seen in rural and urban environments, extending to the most remote settings and bringing vibrancy and jobs to communities."

In order to preserve this into the future, the Ibec campaign says policies must be implemented to allow the industry to position itself to overcome the Covid challenges and look to the future, including through the use of technology and digitalisation and highly skilled and educated workers.

Specifically, Ibec thinks the €5,000 a week cap on the Covid Restrictions Support Scheme needs to be removed and any potential cliff-edge arising from the removal of other state supports must be avoided.

The organization also argues that there needs to medium-term commitment on the 9% VAT rate, a skills strategy for the experience economy and a reduction in barriers to access new skills.

It is also calling for a new national innovation fund for the experience economy and for investment in supporting infrastructure, new product development and marketing.