Hospitality industry experts like the National Restaurant Association report that restaurants are more than 900,000 jobs short, and continued to lose jobs in August and September 2021. A recent Joblist survey revealed that the leisure and hospitality industry has been the most affected by the coronavirus pandemic. With one-third of hospitality workers facing reduced work schedules or losing their jobs because of business closures, they are leaving the hospitality industry altogether.

This impact has been worse for seasonal hospitality businesses, even with the increase in seasonal worker visas. States with sizable seasonal summer workforces like Massachusetts, New Jersey, Wisconsin, Michigan, Virginia, Maine, Ohio, and North Carolina are showing record restaurant job losses. Restaurants have to offer incentives just to get applicants to apply and have had that challenge for most of 2021.

Why the Shortages?

The reasons it’s currently tough to hire in the hospitality sector are myriad. Low-wage, low-skill work, difficult working conditions, lack of advancement opportunity, and schedules not conducive to work/life balance already make the industry difficult to attract workers. The pandemic only highlighted these downsides. Lack of affordable childcare is also a big factor, especially in low-wage jobs. Thousands of pandemic-shuttered childcare programs have created childcare deserts.  

One answer to the question of why the hospitality sector is having such a severe hiring crunch is money. The Bureau of Labor Statistics (BLS) reported that average non-manager hospitality industry wages are less than $17 an hour, even with the 13 percent increase in September 2021. According to hiring platform Indeed, the pandemic has seen a shift in job-seeker interest to higher pay and remote work, with better benefits and schedules than available in hospitality work.

Another reason for the hospitality industry labor shortage is the massive loss of jobs in the first year of the pandemic, 2020, forcing millions of workers to look elsewhere for income. That was unemployment compensation in many cases or other work in other industries. Industry insiders aren’t seeing those workers return to their old or similar hospitality jobs.

With the economy picking up and recovering jobs, it’s more important than ever for employers in the hospitality industry to attract, reward, and keep workers.

What Are Hospitality Employers Doing?

The Society for Human Resource Management (SHRM) reports that hospitality industry recruiters say industry employers need to offer more than basic benefits. Added perks such as covering cellphone bills or continual education stipends create attractive incentives for employers as well, as they are nonpayroll compensation. Hospitality employers are offering referral bonuses, housing opportunities, transportation for commuting, and other attractions in addition to higher wages and benefits.

According to Willis Towers Watson’s recent survey, hospitality employers are increasing salary budgets for 2022, raising starting salaries, and increasing workplace flexibility. Additionally, employers are increasing health and wellbeing benefits, giving larger raises, and designing improved employee experiences.

Hotel companies, in particular, have made some major changes to be able to recruit and hire the workers they need in this pandemic job market:

Salamander CEO Sheila Johnson focuses on diversity sponsors associations that promote diversity such as the National Society of Minorities in Hospitality, as well as supporting veterans and high school students.

Hyatt Hotels Corp. Vice President Audrey Williams-Lee relied on colleague support groups when the pandemic hit, leading caregiving and leadership-supported well-being initiatives. Hyatt Check-In, the Hyatt Alumni Network, and the Change Starts Here commitment helped Hyatt stay connected to current, past, and furloughed workers and strengthened the commitment to diversity.

What Do Hospitality Workers Want?

Hospitality staffing firm LGC Hospitality CEO George Lessmeister says better pay is top of mind for workers. He reminds industry employers that McDonald’s CEO knows it and shows it with the permanent $15 rate. But hospitality industry insiders like Lessmeister know that better pay is not the only thing workers want.

While the pandemic forced many changes across the economy and the hospitality industry, it also forced many workers to get creative and get outside their experience and try new things out of necessity. And they want those opportunities from employers going forward. Offering career path and development assistance is a big incentive in post-pandemic recruiting.

Flexibility is another big motivation for workers as the economy ramps up. Workers are looking for environments with work/life balance, remote work opportunities, and accommodating schedules like four-day workweeks.

A caring culture that backs employees weary of COVID confrontations and complications will attract workers looking for trust and security rather than just another paycheck. Appreciating and recognizing employees for their efforts and accomplishments is a cost-effective way to bond with a workforce in the post-pandemic economy. A supportive environment along with better pay is a recruiting advantage.

Everwood Hospitality Partners Managing Director Tracy Kundey says they’ve found that revising hiring requirements and recruiting from other industries is important for recruiting success. His organization focuses less on prior hotel experience and more on leadership qualities.

As the hospitality industry continues to experience labor shortages with workers refusing to return, hospitality employers will need to pivot even more than at the beginning of the pandemic. They will need to rethink their approach to attracting and hiring workers, reinvent their work environments, and compensate and reward their workforces going forward to compete in the post-pandemic job market.

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