Nearly 3.5 million people left the workforce since the start of the pandemic and the “Great Resignation.” The leisure and hospitality industry was hit particularly hard, losing approximately 1.2 million employees since March 2020. After months of operating at dismal occupancy rates, the world is now slowly reopening to leisure and business travel. Now, the hospitality industry is facing another significant challenge: finding, hiring, and retaining staff to help rebuild the business and grow their teams.
While some older, more seasoned employees initially left the industry due to COVID-19 exposure concerns, the pandemic also led many to early retirement and career path reevaluation. This large gap in skilled middle and upper management left hotel owners scrambling to fill positions, and younger adults were also quitting – for different reasons such as lack of a defined career path, work-life balance, pay, or appreciation.
This labor crunch resulted in lackluster customer experiences that properties are still struggling to repair as the industry rebounds. In response, many property owners have pivoted their hiring approach and retention strategies to ensure their guests have a 5-star experience.
An Oct. 2021 American Hotel and Lodging Association member survey reported that 94 percent felt their hotel was understaffed, with 47% using the term “severely understaffed”. A staggering 96 percent of survey takers reported they were unable to fill open positions.
Low wages and lacking benefits are (still) a part of the problem.
According to the U.S. Bureau of Labor Statistics data, the average hourly earnings for non-supervisory leisure and hospitality employees have risen 19.24 percent between March 2020 and March 2022. Despite this increase, hospitality continues to have the highest quit rate and the lowest pay of any sector, averaging $515/week or $27K/year – less than half of the average for all private workers. Good News: Hourly wages in hospitality are moving up from the low teens to the mid-20s.
Aside from higher wages, many properties are getting creative to differentiate themselves from their competition. Some are offering benefits to hourly staff, while others are expanding vision, dental, and health benefits, initiating more competitive 401Ks, providing continuing education opportunities, and even giving transportation benefits to help move the needle.
Larger hotels with the benefit of management companies may be able to offer higher wages, but how can smaller hotels compete?
Leverage technology for finding and retaining talent.
HR technology like applicant tracking systems (ATS) can help streamline the hiring process by automating job postings, tracking applicants, and ranking candidates. Ideally, a platform that provides personality and skills assessments along with expert support can help hoteliers make better hiring decisions.
Hoteliers are also rethinking which roles can leverage remote work, have more flexible hours, or other alternative schedules. Flexible shifts, same-day pay apps, and timeshare opportunities allow employers to adjust shifts for better employee work-life balance, while still meeting staffing needs.
Consider wages, perks, and the Employee Experience.
We’ve also seen a stronger focus on the Employee Experience (EX). Addressing the need for work-life balance and offering a professional industry path, rather than just a job, helps to meet employees where they are.
Especially for younger or newer employees, development programs are an easy way to increase employee loyalty, retention, and job satisfaction. Internal promotions, advancement opportunities, and upskilling employees also increase employee engagement, filling hotel hiring gaps at the same time.
The hospitality job market has changed. It’s time our hiring criteria and approach did too.
While experience and industry knowledge are always valuable, many properties are looking beyond these job requirements, and instead, prioritizing candidates with transferable skills who are a better personality fit. For example, there is large demand for job candidates with higher emotional intelligence and soft skills, empathy, problem-solving, and compassion is more important than ever in hospitality.
The U.S. Dept. of Labor estimates that the average cost of a bad hiring decision is about 30 percent of their yearly salary. Applicants with higher emotional intelligence can help boost productivity, improve internal and client communications, and inspire teamwork and collaboration among the staff.
An assessment-based hiring approach can help you attract a larger pool of applicants, find candidates that are more likely to climb the management ladder, and help you narrow down applicants to find top talent faster.
Overall, employees are looking for a job where they see opportunity, flexibility, and belonging
If offering more money or benefits is not possible, hoteliers can look for creative "non-wage incentives” to recognize and support the needs of their employees. Members of theGen Z and Millennial workforce especially, want to feel good about the company they are working for, see a clearly defined career path with future opportunities, and have flexibility in their schedules.
The demand for hospitality workers is rising faster than hotels can hire. To meet this need, hoteliers can focus on finding the right talent fit, as opposed to just “filling the position.” By re-evaluating compensation and benefits packages, leveraging technology, and redefining your hiring criteria, you’ll be better equipped to find talent that delivers 5-star guest experiences.
About the Author
Sid Upadhyay is the co-founder and president of WizeHire, an award-winning hiring platform that connects hoteliers to 5-star talent through their applicant tracking system and expert hiring coaches. Sid has published machine learning research under the Association for Computational Linguistics and holds a B.S. in statistics from the University of Texas at Austin.