Longer contracts will help solve labour shortages

ceo

Insight Comment
Labour shortages are causing big headaches in the hotel industry. Low pay is a critical factor but tenure arrangements – job security – may be a more powerful tool. By retaining people for longer, fewer young employees will take their skills elsewhere. The talent pool from which to fill senior roles would also get deeper.

Workers' status as well as pay needs reviewing if the hospitality sector is to find effective long-term solutions to labour shortages, the panel discussion entitled: “Re-Building the Leisure Hospitality Experience,” was told.

The dearth of people available to fill roles in the now-rebounding leisure sector is widely recognised. Hospitality is far from being the only industry feeling the pressure. 
The host of the session, Roger Allen, CEO of RLA Global, said: “The industry was hit with major challenges.” 

Ramón Braña Cobas, CEO of Oca Hotels which has coastline properties in Spain, Portugal and Brazil, said: “The lack of labour is one of the main problems in our company.” 

The lack of job security, meanwhile, showed as so many employees were left without work when the closures caused by Covit hit.

Georg Schmickler is CEO of the hotels division of DER Touristik Group, the German travel company. He said: “Hotel industries may not be the most attractive when it comes to labour. Moreover, people who work in hotels are highly attractive for other industries because they are very well educated, they are service oriented and they are used to working during the day and night. This is something we have to work on. We want customer loyalty but we also need labour loyalty.”

Jordi Ferrer, CEO of Hesperia World, said: “We need to address all these topics, have more long-term contracts instead of seasonal or other shorter term arrangements that will allow employees to be more engaged.”

The trio were speaking at the Resort & Residential Hospitality Forum 2021, hosted in person at the Tivoli Marina Vilamoura Algarve Resort in Portugal. 

They were joined by Ramón Aragonés who is CEO of NH Hotel Group, the Spanish subsidiary of Minor International (MINT). NH, Aragonés said, employs 12,000 people and as a larger operator can offer career development. “As I often say,” he added, “if you take care of your people, your people will take care of your clients.”

Aragonés made bullish comments about the recovery in the market and said he thought that the business-focused trade in urban locations is also reviving. He acknowledged that the city centre business would take longer to recover. Aragonés registered concern about “double-digit” percentage increases in costs. 

Aragonés became managing director of NH’s Spanish business unit in 2010 and in 2017 was appointed CEO of NH Hotel Group. 

From the hosting chair Allen said that hotels which give guests enjoyable experiences, not just a bed to sleep in, were leading the industry out of the revenue deserts cause by Covid. “It is a trend that was coming pre-Covid,” he said. “It’s importance is now being reaffirmed and is spear-heading recovery.”

RLA Global, which advises investors, owners, developers and management companies, specialises in hospitality, leisure, recreation, wellbeing and health tourism related to hotels, resorts, residential, mixed-use, healthcare, active living communities and destination tourism developments.

CEO Allen quipped: “I think this is one of the first times that we can actually begin to talk about – dare I say it – the post Covid era when it seems like the light at the end of the tunnel is not an on-coming train.”

RLA Global works with public and private sector clients in the Americas, Europe, Middle East and Africa. Allen is a board director of the International Society of Hospitality Consultants (ISHC).