Lots of jobs, less immigration causing hotel labor shortages

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Photo Credit: RossHelen/Shutterstock

With U.S. unemployment remaining at record lows and immigration reform efforts at a political impasse, the hospitality sector finds itself grappling with a growing labor shortage problem.

According to the Deloitte 2019 Travel and Hospitality Industry Outlook, the current hospitality workforce gap has reached unprecedented levels, with the U.S. Bureau of Labor Statistics estimating that there were more than a million job openings within the leisure and hospitality sector in 2018 versus over 350,000 job openings in 2009. 

The situation has been further exacerbated by the Trump administration's tightening of immigration policies. Deloitte reports that while immigrants make up about 13% of the total U.S. population, the segment accounts for a highly significant 31% of the hotel and lodging industry's workforce and 22% of restaurant employees.  

Trade groups like the American Hotel & Lodging Association (AHLA) have responded by stepping up their lobbying for immigration reform on Capitol Hill, but with change unlikely anytime soon, many hospitality execs are eyeing alternative ways to help ease the shortage in the near term. 

Guy Langford, Deloitte's transportation, hospitality and services industry head, said he believes that the hotel sector must get more creative in "winning the hearts of employees" and remaining competitive against other industries.

"When you look at what the hospitality industry is doing now, much of it's centered on creating a much stronger emotional connection to their employees, which goes a long way toward securing talent," Langford said. "Having the right culture and making sure you have a clearly stated purpose is now really important. And that purpose has to be greater than just delivering hospitality. It has to appeal to the emotions, perhaps along the lines of sustainability, community or inclusivity."

One hospitality group that claims to have successfully fostered a sense of workplace camaraderie and purpose is Margaritaville Holdings. According to CEO John Cohlan, the brand's focus on building an engaging corporate culture has translated into relative ease when it comes to attracting prospective workers.

"I'm always stunned when we have our labor fairs because of the number of people who apply," Cohlan told the audience at last month's Americas Lodging Investment Summit in Los Angeles. "We have an advantage on labor at all our properties because they're fun places to work. When you come and apply for a job, we want you to be part of the experience. And when people are being taken care of and tended to by someone who's having fun, they have more fun." 

In addition to improving workplace cultures, Langford asserted that the hospitality industry needs to step up efforts to not only find and hire employees but to retain them across a longer period of time. 

"The reality is that there's a lot of transient and hourly talent in the hospitality industry, and there's a lot of churn," Langford said. "Companies need to ask if there's a way to really keep people. Can someone start at the front desk, work their way up to management and then maybe even become a senior leader? Some of the industry's senior leaders of today have taken [that path], and so it's about actually telling those stories and getting that next generation to understand that hospitality is a great place to start a career."

The AHLA has launched several initiatives through its Educational Foundation to promote long-term career development, including a program unveiled last year that enables participating companies to offer employees no-cost and low-cost higher education degrees. 

This January, the AHLA also debuted a "Hospitality Is Working" campaign focused on encouraging workforce investment and cultivation. As part of the campaign, the AHLA Education Fund has pledged $500,000 grants to community-based organizations in Orlando, Dallas, Baltimore, Chicago, Los Angeles and Washington to support the recruitment of 16- to 24-year-olds.

Brian Crawford, AHLA senior vice president of government affairs, said the Education Fund "is laser-focused on addressing [the labor] issue. We need more incentives for employees to stay within our industry, so they don't go follow the next shiny ball."

Technology advances are also poised to help narrow hospitality's labor gap. Langford said the increased adoption of concepts such as mobile self-check-in, for example, could help streamline front-of-house operations, enabling a reduction in staff without sacrificing service. 

"When you're able to automatically check in -- instead of having three people behind computers at a front desk, you might just see one person in the lobby with an iPad ready to welcome you and ask if there's anything else you need during your stay -- that can actually become a higher value-add," Langford said. 

Still, Langford warned that within the hospitality space, technology needs to be leveraged in "a thoughtful way," adding that the industry's reliance on human engagement isn't something that can easily be digitized or outsourced. 

"Hospitality is very much a person-to-person industry," he said.

For now, hotel executives appear to be in general agreement on that front, with Elie Maalouf, InterContinental Hotels Group CEO of the Americas, recently echoing Langford's sentiments. 

Technology, Maalouf said, "has to increase productivity and efficiency, but not at the expense of customer experience."

Citing his company's ongoing investments in modernizing guest reservation and property management systems, Maalouf added, "We look at technology as something that can enhance the humanity at our hotels, not replace it."

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