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In a poll from a recent DHG webinar, Navigating the Labor Shortage for Construction and Hospitality, over 80% of those responding said that the current labor shortage is impacting them moderately, notably or keeping them up at night[1]. While the challenge of hiring and retaining top talent is not new, the Great Resignation or Reshuffle is requiring hospitality leaders to rethink their approach to labor issues.

Since the start of the pandemic, workers have been missing in the hospitality sector. The Bureau of Labor Statistics (BLS) notes that between February and April 2020, almost half of all hospitality jobs disappeared. Additionally, BLS found that as of February 2022, 2.1 million leisure and hospitality jobs are still missing[2]. Luckily, there is improvement in jobs returning in the leisure and hospitality industry[3].

Why Is There a Shortage of Labor?

When hotels and restaurants closed at the onset of Covid-19, workers had time on their hands to think about what they wanted in life. Some chose to retire early. Others decided that caring for family members, both older and younger, was a priority. Others still looked for opportunities in other industries or remote work. This all made an impact on the industry which prides itself in creating an experience for customers.

Who Is Feeling the Impact?

Those bearing the brunt of this labor shortage are many. As people are back to traveling for work or are taking advantage of the work from anywhere phenomena over the last 18 months, they may have noticed a different guest experience. Bar hours might have been shortened due to only one bartender now being on staff. Check-in times may have been delayed due to not enough staff to change over rooms as quickly.

The guest experience overall has been impacted by the labor shortage. Guests are still paying the same rates in many cases, but the experience may have dimmed a little. Restaurants have gotten creative by closing one or more days per week to keep the staff from burning out. While this impacts the bottom line, restaurant owners know that employee morale is an important part of giving a fantastic guest experience[4].

Hospitality is not the kind of industry that is sustainable with remote work. Resorts and other service-related venues need people on the premises willing to offer great guest experiences to customers. The constraint is finding people willing to provide that service. When managers and owners couldn't find labor, they resorted to turning over rooms themselves while still keeping up with their other duties so they could keep the lights on.

Employees working in resort towns or major cities find themselves priced out of the housing market. The lack of affordable housing keeps workers from considering open positions in these pricier areas. Despite wages increasing across all industries, sometimes that isn't enough when prices are increasing in other areas like food and childcare[5].

Creative Incentives

Employers need to be creative in understanding what the workforce requires for work-life balance. Employees are looking for flexible scheduling when possible. For example, hospitality managers are recognizing that they can't expect workers to work loyally with no incentives. In the past, workers were content with a pat on the back at the end of the day. But the days of the hourly wage "churn and burn" are in the past.

Strategies for Recruiting and Retaining: There have been a common set of best practices helping organizations achieve their labor goals:

  • Hire with intention – Be proactive with your interest and accelerate your process. Do not expect the candidate to work around your schedule for interviews; you must adjust to them. Don't wait too long to make a decision; that candidate may already be hired.
  • Express your corporate values and culture – Reflect on why your corporate culture is a better fit for a candidate's career and personal goals. Consider developing a career path program and other benefits that demonstrate your genuine interest in your workforce.
  • Promote flexibility – While many jobs require employees to be on-site, you can find opportunities to offer flexible hours and better technology to accommodate a worker's schedule.
  • Customize positions – There may be ways to create hybrid roles based on an employee's talents that allow workers to grow skills in another aspect of the industry.
  • Develop to retain – Due to the current labor shortage, most companies are rightfully putting a focus on recruiting top talent. It's important to remember that it may take several recruits to ultimately fill one position, and it only takes one retention to fill that same role. A successful focus on retention includes intentional development. Companies that commit to working with employees to develop their careers and opportunities may experience higher retention rates,

Enlist a Chief People Officer – Transform your culture with a specialist who understands how to help you make employees feel valued and motivated to help you succeed. To learn how we will put our technical knowledge, industry intelligence and future-focused approach to create a customized strategy for you, please reach out to us at cre@dhg.com.

[1]   https://www.dhg.com/event/navigating-the-labor-shortage-for-construction-and-hospitality
[2]   https://www.moneygeek.com/coronavirus/cities-most-hospitality-jobs-impacted-coronavirus/
[3]   https://www.bls.gov/news.release/empsit.t17.htm
[4]   https://www.carolinacoastonline.com/news_times/article_dfb0e16e-e0d8-11eb-85b0-77af621eb527.html
[5]   ttps://www.usatoday.com/story/money/2021/11/18/inflation-bumps-childcare-costs/8622403002/?gnt-cfr=1

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