Today’s employment environment is like nothing we have experienced before.
The last pandemic happened in 1918, with a very different labour and economic atmosphere. There are no easy answers to a vast number of questions and nuanced circumstances.
The travel industry has been particularly hard hit, as so many people were furloughed last year without any real answer about when they would return. As an “academy industry,” a large portion of these furloughed people were in line-level and entry-level management positions – the most vulnerable faction of the American economy.
Our experience in the hospitality job market has given us a perspective from clients of all sizes, locations and financial wherewithal. As fast as the pandemic hit, closing the U.S. economy, the reopening has been nothing short of chaotic. It seems that everyone wants to travel to express their pent-up frustration with the pandemic and their personal independence.
According to a study by Travel Leaders Group, nearly 70% of Americans planned to travel in 2021. On the job front, the AHLA recently quoted that 96% of their membership hotels have openings at their property.
You would think everyone would be doing a victory lap; unfortunately, employment supply and demand are wildly out of sync. We believe it is going to take some time (two-plus years) for the employment marketplace to normalize. Here are some of the reasons why:
There is a mismatch regarding what employers and individuals are looking for in a role. Many of the people that were working in the hospitality industry prior to the pandemic simply don’t want to go back. Low pay, hard work, perceived health risk and a multitude of other opportunities exist.
Our clients are having a particularly difficult time filling housekeeping and food service roles. We have seen trends such as housekeepers going to work for private residences and other less risky environments. Chefs have also migrated to working for private families, ghost kitchens and other forms of food service.
Idea: The industry needs to make positions more interesting, multi-faceted and focused on career growth. Thinking that a housekeeper is going to want to clean or is capable of cleaning rooms for 25 years just isn’t practical. Professional waiters and cooks are a thing of the past. Make more roles a hybrid so that people get exposed to more and varied responsibilities. Incorporate more technology into hotels and restaurants to make it easier on employees to serve and interact with the guest.
Many people moved from high density areas such as New York and Los Angeles, and as such aren’t willing to move back right now. Most hospitality jobs are “in person” jobs and can’t be done remotely. This has made hiring much more difficult in major metropolitan areas and other areas that have high levels of new COVID cases. Interestingly, the migration of talent has also put stress on the areas that have experienced a significant influx. Generally, Americans moved West and South, as well as “outward” to the suburbs and less populated areas in the same state.
Idea: We must entice people to come back to work by making it more lucrative and safe. Offer more remote roles. Salespeople, human resources, finance, creatives and such can be remote. Rethink line level roles to minimize staffing and maximize pay. In-person workers should make a premium to those that are working remotely.
Many people are reassessing their careers and the types of work that they find fulfilling. Many have chosen remote forms of work, with more flexible hours and pay. As much as the hospitality industry is a labour of love, serving unruly and rude customers has become all too prevalent. Many people who have used food service as a secondary source of income have opted for other forms of work.
Idea: Retraining and career management should be offered by every employer in our industry. We must show people how important and vibrant our industry can be. Companies should draft a code of conduct for themselves and their customers. Ritz-Carlton was so good at that with their “Ladies and Gentleman” slogan, but it has to be a two-way street. Working in a hotel needs to be fun, not a drudgery.
The hospitality industry is dominated by first generation immigrants. Historically, our industry has been a haven for many people immigrating to the U.S. The previous administration’s immigration policy put a considerable damper on the influx of people suited to hospitality type work. The Biden administration has done little to reverse this trend.
Idea: We must be a force on Capitol Hill. Our industry employees a significant number of people and our voices need to be heard. Support the AHLA and its efforts to swing immigration policy back to a more normal rate. Closing the borders so that Americans can turn down entry-level work is not a politically sound strategy. Most of us and our families were immigrants at one point. We need to bring back the American Dream.
Child, elder care
Child and elder care have been significant impediments for some parents going back to work. The entire schooling and childcare systems have been deeply affected by the pandemic. Until we can safely and economically put those systems back in place, many people will stay on the sidelines.
Idea: Local hotels and restaurants need to work with officials on child and elder care policy. Businesses need to band together to offer these services as part of employment and benefits.
One of the big discussions going through the business and political communities is the unemployment bonuses and other public policy that has influenced employment. With the pay in hospitality being traditionally low, staying out of work has been financially better than returning to work.
States such as Hawaii, New York, California, Nevada, and Connecticut have unemployment rates that are at least four percentage points higher than their pre-pandemic rates. Some of that is due to state and local policy that has demotivated people from going back to work.
Idea: Over taxation and waste are going to hamper big cities from recovering quickly. Incentives to business owners and other significant employers need to be offered immediately. Small business has been the backbone of this country and will continue to be if municipalities get creative. Bonuses for returning to work and staying are better incentives than paying people to stay out of work.
Summer and freelance employment that favour teens and students have been upended by the pandemic and dramatically impacted hospitality companies’ hiring practices over the past two summers. We suspect this will bounce back next year as employers and prospects will have more time to match with each other.
Idea: Start thinking about next summer season and where students and part-timers will be. Get on campuses and local high schools early and promote our industry as a viable option.
The pandemic has made it difficult to near impossible to forecast demand. Decision-making in travel appears to be very last minute.
As we previously stated, 70% of Americans planned on traveling this year, but the where and when have been “just in time” decisions. This trend has made staffing incredibly hard on business owners. It appears that many hotels and restaurants are running with skeleton crews and “on-call” staff are used to augment rushes in business.
Idea: Over the next two years, business owners need to have highly skilled full-time staff coupled with part-time/on-call staff. Always be networking and interviewing. Offer introduction bonuses to staff for bringing people into the organization.
Training needs to be a full-time role, and the use of remote and online learning should be employed immediately. Simplify service standards, menus, amenities and protocols at every turn. Redefining quality is a must for our industry.
Keith Kefgen, New York, CEO & Managing Director
AETHOS Consulting Group is a global hospitality advisory firm serving people-driven businesses (including the hotel, restaurant, casino, cruise line, club and travel sectors). We enhance value for our partner organisations via access, know-how and fresh thinking. Core competencies include executive search, compensation consulting, organisational development and psychometric assessments.
Designed as a single partnership, AETHOS maintains presence in numerous national and international locations, serving clients across the globe. Our mission: To serve, solve and succeed on behalf of our clients and on behalf of our stakeholders.