A Crisis So Immediate and Obvious, You May Have Already Missed it.
By John R. Hendrie & Brecca Loh
Thursday, 28th September 2006
Is there a bigger challenge than designing the Guest Room of the Future - building the most extraordinary mixed-use resort facility - identifying the dining trends of the rich and famous or creating the next terrifying yet exhilarating theme park ride?  Might we posit, there is.

Who, in five years will deliver on your Brand promises, for Hospitality, in particular, and all businesses will be facing a most severe shortage of labor and certainly talent.  In large part due to the aging of the workforce, the Bureau of Labor Statistics projects a shortfall of 10 million workers in the US in 2010.  Western Europe will experience a more dramatic deficit.  We are already relying on skilled labor from developing countries, such as India and China. 

The Hospitality Industry does not have the option to move operations offshore or to outsource service.  We, just like our colleagues in Health Care and others in the semi and non-skilled arenas, are stuck here, all competing for that rare commodity – reliable labor.

We have not paid close attention or merely accepted long ago a bogus management imperative.  We in Hospitality live with a turnover rate of 100%; we spend a mere pittance on training and development.  We fight for minimum wage status and minimal benefits, if any.  In short, we will be short, and that does not even indulge that spectre of Immigration, which globally has already created massive concerns, social and economic. 

So, expect significant restrictions and constriction within the labor force. To be candid, enforcement of current Immigration laws would close the doors of many light manufacturers, agriculture, and, you know it, some of your colleagues.

Also, keep in mind the general profile of our employees: primarily female, immigrant, not highly educated, and pronounced disenfranchised by many, certainly prime prospects for Organized Labor, whose presence shall become more prominent, because we have not been doing our job.  We have effectively neglected the greatest threat to our competitiveness – the dwindling Labor Pool, and we have been averse to take a leadership role as an industry, even as a business.  The acquiescence is a shame!

The numbers usually get some attention, spurring some to action, or at least discussion:

  • The general population is aging; the available Labor Pool is aging; the birth rate is at historic lows.
  • Ages 16-24 are growing at a rate of 15%; ages 25-34 are growing at half that rate; ages 35-44 are declining.
  • In the next 15 years, 80% of the North American workforce is going to be over 50 years of age.  And, the "Boomers" are walking out that door, hurriedly, representing a huge "Brain/Brawn Drain"
And, these are only figures based upon age.  Think of the full panoply:  sex, race, education, etc.  Do we have your attention, or will you return to the "warm body" philosophy, which will not exist in the very near future.  We are alarmed.  Let's talk Strategic Manpower Planning! What are your plans?

There will be "Wars for Talent", and you must adapt your philosophies to retain older workers and attract new talent.  Those who win the battles will be those wrested in progressive workforce development strategies.  You do not have to be a huge corporation to make ready, but you will need to target your workforce and maximize your human capital.  We know this argument is unpleasant for many in a labor intensive business, but this is the reality.  Choose or close!

Our Template for this mandated change in direction, philosophy and operation is the following, at minimum:

1.  Be more competitive in attracting and retaining new employees, especially those with critical skills.  Drive your communications to all parties, constructively and honestly.

2.  Create performance incentives and training programs which motivate and empower.  Invest in your people.

3.  Build management-employee relationships, based upon common interests and trust.  Become participative.

The above is not new, but the application will be for many, as Hospitality is very slow to change and is not progressive.  We are not fortune tellers.  Your means to deliver product, service and business processes will change, so you have a small "window of time" to manage that, rather than lose control.  Your Human Resources professionals will help chart this journey for you.  Bring them to the table, seek their expertise as a Strategic Partner.

So, what will the Workplace of the Future look like?  As we know from above, the term Future is relative.

  • It will be team oriented and collaborative.
  • Emotional Intelligence and innovation will be emphasized.
  • Positive attributes will be amplified:  loyalty, resilience, adaptability, trust, humility and compassion.
  • Change will be embraced
This is not the usual Hospitality Culture we all know, so some work will need to take place.  But, we encourage urgency, for you are at risk. Manpower Planning (sourcing, recruiting, selection, retention) should be an agenda item for your Executive sessions, certainly for your association and professional business meetings. 

There are a host of resources on the market, as well.   Our Brands pronounce our brilliance and service, which very shortly, if not already, shall be challenged by those we employ to represent our best efforts.  Who will deliver on your promise?  A "Blind Eye" is debilitating and no longer an excuse.  Perhaps, this will light the fire.

About the authors:
Brecca Loh is an advocate of promoting "Human Capital" as one of the strongest assets of any organization. Please learn more on www.cobaltsp.com

John R. Hendrie believes that Remarkable Hospitality is the portal to the Memorable Experience. Review the resources on:
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