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Hotels are slowly hiring more workers — but the industry is still far from recovered

March 08, 2022
6 min read
person delivering room service on a cart to hotel room
Hotels are slowly hiring more workers — but the industry is still far from recovered
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Two years ago, COVID-19 took the world by storm and changed nearly every aspect of our daily lives — especially how we travel. But finally, the hospitality industry seems to be on the rebound.

Just because the numbers are looking up as more people travel and hotel rates are inching closer to pre-pandemic levels, however, the most recent national jobs report shows that over a million hospitality-related jobs are still missing compared to before the pandemic. What's worse, despite rising hotel rates, travelers are still being forced to give up some of the perks we love most at hotels, such as speedy room service and daily housekeeping.

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While things feel generally optimistic, the latest U.S. jobs report released by the Bureau of Labor Statistics shows that the leisure and hospitality industry still has plenty of ground to gain, especially in the lodging sector. In February, the leisure and hospitality industry gained 179,000 jobs with the majority of that growth (over 124,000 jobs) happening in "food services and drinking places" and the rest (over 28,000 jobs) happening in the "accommodation" sector.

Overall, the leisure and hospitality industry is down 9% since February of 2020, before the pandemic swept the globe. But to really put that in perspective, while jobs are constantly being filled or added back into the hospitality industry across bars, restaurants and hotels, it's still down a whopping 1.5 million jobs from this same time two years ago, according to the report.

"Those responsible for operating hotel assets in the U.S. universally agree that labor [and] workforce issues are the number one challenge facing the industry," Scott Berman, the hospitality leader at PwC Principal, told TPG. "The recent job report is encouraging but there are still major gaps across the operating model that are impacting service delivery."

If your experience has been like many travelers over the last two years, you have probably felt the effects of these 1.5 million service-oriented jobs missing from the industry — or are still feeling them.

Hotels around the world have completely altered how they operate, largely at the expense of the customer experience. Hotel bars and restaurants, for example, either shuttered completely or turned to limited menus and grab-and-go breakfasts instead of the standard fare; and lounges reserved for elite members locked their doors, with many yet to reopen.

Then there's housekeeping, which continues to be a serious issue for many travelers. As the number of housekeepers was significantly reduced at hotels, so were daily housekeeping services. From your everyday budget properties to luxury resorts and even Disney hotels, housekeeping was limited, oftentimes to every other day, with "light" cleanings (think: maybe your garbage was emptied) in between.

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(Photo by DragonImages/Getty Images)

While the pandemic was to blame for the majority of the hospitality jobs lost in the last two years, the industry has had a disproportionate recovery compared to the U.S. job market as a whole. Workers are often afraid to return to low-paying service jobs that could easily be cut again in response to a new COVID-19 variant, lack of business travelers or any other number of problems that could keep people from traveling.

"There is not an overnight fix," Berman explained, but that ground could be made up by hotels working with trade groups such as the American Hotel & Lodging Association to "promote and incentivize" benefits such as higher wages, better health care, 401(k) options, childcare, flexible shift and referral bonuses, as a start.

“The overall jobs report today may be good economic news for certain sectors, but nearly three quarters (73%) of all jobs still lost due to the pandemic are in [leisure and hospitality]," Tori Emerson Barnes, the executive vice president of public affairs and policy at the U.S. Travel Association, said in a statement. "The sector’s uneven recovery is due to the lack of available workers, and revenues are down due to a lack of inbound international travelers and the deep reduction in business travel and professional events. Today’s job numbers reflect the great need to accelerate the return of business and international inbound travel and the recovery of these [leisure and hospitality] positions."

The recovery of the industry could be aided by a number of government actions, including removing the predeparture COVID-19 test requirement for vaccinated travelers flying to the U.S. from abroad; providing tax credits to stimulate business travel; and raising the cap on H-2B visas for "temporary nonagricultural workers" to "ease the absence of labor for the more than 1 million job openings in the ... industry," according to the U.S. Travel Association.

Despite the ongoing staffing shortages — and commensurate service reductions — the cost of hotel rooms has been on the rise. While the numbers aren't completely back to pre-pandemic levels, they're getting close in plenty of destinations as more people feel comfortable traveling again. In January of this year, average daily room rates were only down, on average, by 0.3% compared to January 2019, according to hospitality data company STR.

Though it's easy to get lost in the data, this basically means that people are paying nearly what they were before the pandemic to stay in hotels that, more often than not, are offering fewer services and amenities.

But those higher rates could actually be beneficial to guests and the overall recovery of the industry in the long term, according to Skift, which reported that "higher daily rates make higher worker wages possible, and it’s unlikely rates will go down amid the higher demand expected this spring and summer."

Or, as Berman suggested, hotel owners might choose to replace outward-facing employees with technology. "Hotel owners are demanding their operating partners 'do more with less' .... [and] reduce the reliance on on-premise labor."

Personally, I'm trying to remain optimistic about the recovery of the hospitality industry — and Berman agrees, saying that "the U.S. hotel industry, generally speaking, is in a full-fledged recovery."

For the most part, I experienced quick and uninterrupted service during my recent hotel stays in Austin, Atlanta and Nashville. But I know many travelers are still continuing to experience the frustrations of staying at understaffed hotels that are forced to cut corners or are providing slow and subpar service.

Hopefully, hotel owners will be motivated to put some of the cash that's being injected into the industry back into the pockets of potential employees who are ready to return but need more security and financial equity.

Until then, we may still be paying more for less and missing out on the human element that makes travel and staying at hotels so special in the first place.

Featured image by Getty Images
Editorial disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

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Best for earning alternative rewards for travel purchases
TPG Editor‘s Rating
Card Rating is based on the opinion of TPG‘s editors and is not influenced by the card issuer.
3 / 5
Go to review

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10XEarn 10x points on eligible hotels and car rentals booked through the Credit One Bank travel partner site
5XEarn 5x points on eligible travel, dining, and gas
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  • Intro Offer
    Earn 10,000 bonus points after spending $1,000 on eligible purchases in the first 90 days and redeem for a $100 statement credit, gift cards, or travel

    Earn 10,000 Bonus Points
  • Annual Fee

    $95
  • Recommended Credit
    Credit ranges are a variation of FICO© Score 8, one of many types of credit scores lenders may use when considering your credit card application.

    Fair/Good

Why We Chose It

The revamped Wander Card from Credit One Bank earns cardmembers up to 10 points per dollar spent on eligible travel purchases. With no foreign transaction fees, the card is also great for international travel. However, points earned from this card can only be used at a fixed value, so it may not be the best option for those striving to get maximum value from their rewards.

Pros

  • This card has no foreign transaction fees and earns up to 10 points per dollar on travel purchases through the Credit One Bank travel partner site.

Cons

  • While cardholders can earn a significant amount of points on travel purchases, there isn't any way to redeem points from the Wander Card for maximum value (beyond 1 cent per point).
  • Earn 10,000 bonus points after spending $1,000 on eligible purchases in the first 90 days and redeem for a $100 statement credit, gift cards, or travel
  • Earn 10x points on eligible hotels and car rentals booked through the Credit One Bank travel site
  • Earn 5x points on eligible travel, dining, and gas
  • Earn 1x points on all other purchases
  • Redeem your reward points for statement credits, gift cards, merchandise, flights, hotels, and more
  • With $0 Fraud Liability, you won’t be responsible for unauthorized charges
  • Free Online Credit Score and Credit Report summary, terms apply
  • If you are a Covered Borrower under the Military Lending Act, you may get a different offer
  • See Rates & Fees