How travel survives the people shortage

Travel providers were hit hard just when leisure
demand began to soar. The result: Some hotels couldn’t reopen, and those that
did, did so with skeleton crews.

According to Phocuswright’s latest travel research report Help Wanted: How Travel
Survives the People Shortage, airlines had to cut routes and cancel
flights at the last minute because there weren’t enough pilots or flight
attendants. Other travel businesses have had to reorganize tasks around
existing staff while fast-tracking their recruiting efforts.

Soaring demand shouldn’t normally be a problem. But
an October 2021 survey from the American Hotel
and Lodging Association (AHLA) found that 94% of hotels were understaffed
and 47% were “severely understaffed” from the lingering crisis.

Marriott, for example, had 10,000 vacancies to fill
in September 2021 at its 600 managed hotels in the U.S., according
to the Financial Times.

Even with gradual improvement, the labor pains continue: An analysis for AHLA by Oxford Economics
found that hotels are projected to be down by 166,000 workers at year-end, a 7%
decline from 2019.

No quick fix

There are myriad solutions for helping airlines,
hotels and other travel businesses to rebuild staff – but they are all
expensive. The best approach for enticing new talent is money, of course –
paying higher wages, whether to an hourly worker or a new manager. (The average
hourly earnings for the leisure and hospitality sector is approximately
$19.75).

With unemployment near an all-time low, workers feel
empowered to ask for more cash and benefits, and they’re getting it. This
creates new problems and can discourage existing (loyal) staff – so they need
to be compensated as well.

Raises, promotions, benefits (e.g., matching 401K,
wellness), and bonuses (including referral bonuses) go a long way. But they
still don’t solve the problem when competing with so many other industries that
historically pay more.

Travel, tourism and hospitality used to be one of the
more attractive industries for career building, but that was before the
pandemic. The industry is still a great place to work, but it has a PR problem.

The AHLA recently launched an ad campaign touting those advantages, such as traveling to
interesting places or obtaining travel discounts. One of its tag lines,
“Make Everyone’s Travel Destination Your Workplace,” highlights the
allure of travel itself.

As with other industries, travel companies are also
promoting the opportunity to work from anywhere, except for employees who do
not deal directly (face-to-face) with customers, or who operate a plane, train or tour.

Following the pandemic, most workers got used to and
still prefer working remotely, even if just a few days a week. Many travel
companies can offer that – and many prospective employees demand it.

But for companies that need people on the ground, it
is harder than ever to attract talented prospects who have more opportunities
than ever to work remotely in other industries, often for more compensation.

This article discusses
some of the main challenges faced by the air and hotel segments in restarting
and revamping their industries, while balancing the conflicting challenges
stemming from high demand, skyrocketing prices and an unprecedented shortage of
available workers.