Talk to anyone in a senior position in the hotel industry and the issue of staffing will frequently crop up. It’s easy to see why.
In the US, there’s been around a 16% decline in accommodation workers since June 2019, meaning that hundreds of thousands of people have departed the industry. While in Europe, according to an analysis by the World Travel and Tourism Council, around 1 in 5 vacancies in the sector remain unfilled.
Over the past couple of years there have been stories about hotels having to shut for part of the year or even close down whole floors because they didn’t have the required number of staff. All this presented a huge problem this summer with most COVID-19 restrictions lifted across Europe. Consumers want to get back to travelling but are the levels of service there?
What hotel execs say
Listening and reading transcripts from analyst calls with the big hotel companies it was surprising how little coverage the labour angle got but for some hotel execs it remains a key point of focus.
For Accor, attracting talent is one of its four key priorities for 2022. Speaking after the publication of its half-year report, CEO Sébastien Bazin outlined the thinking at the moment.
“It’s not devastating but it is worrisome,” he said.
Bazin reckons Accor has been able to maintain its talent numbers but in order to service a return to occupancy levels of 2019 it will need additional people. “You need more bodies in this industry,” he said.
Getting better
One of the most interesting revelations from the quarterly updates came in the form of comments from Marriott’s CFO Leeny Oberg.
She said that in the US and Canada hourly wages had increased and kept pace with inflation, and maybe even nudged a littler bit higher, but added that the “pace of increase has slowed”.
“[O]ne of the things that I think is interesting is to look at the positions that we’re trying to fill if, for example, normal staffing levels were that we were trying to fill the final 95% to 100% of the positions we needed at the hotel level. Right now, we’re at 93%. So it’s definitely improved. It is not back to where we were in ‘19 in terms of the labour shortage, but we’re definitely seeing steady improvement, and the wage increases have slowed,” she said.
“Outside the US, it’s much more varied. It really depends on the particular market. And I would say Europe probably has seen some more similarities to the US, while in Asia Pacific, for example, there is really been far less of the kind of pressures that we’ve seen in the US.”
Marriott is basically saying it is not far off 2019 staffing levels - a much rosier picture than some are painting.
It is likely though that it is market specific with countries like the UK suffering from their own problems such as the impact of Brexit.
Difficulty planning ahead
The central issue for the hotel industry is whether to stick or twist. As a hotel should you ramp up staffing numbers now to cover this summer in the hope that demand remains steady over the coming months and years? Or should you be more conservative in the face of macroeconomic uncertainty heading into winter?
One way of dealing with this is to redesign hotels so they are less reliant on people in certain areas. IHG Hotels and resorts is in the middle of a redesign of its Holiday Inn estate. Part of the design change is a reimagined lobby layout, which CEO Keith Barr told analysts would “make it more social and drive improved guest satisfaction while also reducing staffing levels, a key area of focus for owners given labour pressure in many markets.”
The idea of solving the labour issue through technology has become more and more popular since the pandemic with plenty of firms talking up their credentials.
The tricky thing is deciding which jobs to apply technology solutions to.