As a whole, the leisure and hospitality industry is still down 1.7% employees, or a little over a quarter million roles according to the Bureau of Labor Statistics Employment Situation for August 2023.
One way hotel owners and operators can attract and retain customers and increase profitability is by hiring the best team. Customer service is central to all guests’ overall satisfaction with any given hotel, meaning employees can make or break the overall experience.
Below, we’ve pulled together an overview of top challenges making an impact in the hotel industry, and how an effective hiring strategy can help your hotel overcomes these challenges.
Top challenges impacting the hospitality industry
Increasing competition
Hotel owners and operators face fierce competition from fellow hotels – in the U.S. alone, there are more than 50,000 hotels and 5 million rooms. But other hotels are just a small piece of the competition puzzle.
In recent years, hotels have seen competition from alternative accommodation sources like Airbnb and VRBO. With more and more travelers choosing to stay at hotels in an ongoing downward trend in the short term rental market, having enough staff on your team to provide a guest with the best experience possible will become even more necessary.
Online reviews
Given the countless options available for guest accommodations today, consumers are tapping into online reviews – such as Yelp, TripAdvisor, Hotels.com, Kayak, and Booking.com – now more than ever before deciding to book. An Expedia study found that nearly a quarter (72%) will choose to stay at a hotel with a higher review that one under a brand name or with a more competitive price. This means your hotel needs to create an exemplary customer experience – one worthy of great guest reviews and references – or prospective guests will opt for a nearby hotel, Airbnb, or other accommodation with better reviews.
Your employees have a significant impact on your online reviews – if guests have a great experience with your staff, they’ll likely highlight it in a review. Your staff even has the potential to take guests’ visits to the next level by recommending their next favorite restaurant or attraction. But guests also won’t hesitate to leave a negative review if they have a less than stellar experience with your employees.
Labor Shortage
The U.S. unemployment rate has been hovering at the lowest we’ve seen in 50 years for the majority of this year, meaning businesses across industries – including hotels – face stiff competition to fill open roles. If your team doesn’t fill profit-driving roles quickly, like cleaning staff, you’ll lose profit for each day you have an open role. For example, each day a room isn’t ready for guests upon check in, your hotel will lose money – and risks guests leaving negative reviews.
Stand out from the competition by building your best team
Rather than seeing common industry challenges as a threat, you can embrace these challenges as an opportunity to improve overall business operations at your hotel. And to get ahead as a hotel owner or operator, your employees are your main source of competitive advantage – so it’s critical to focus on improving your people operations.
Build a strong employment brand
With so much competition for employees and customers, developing a strong employment brand is a critical first step to improve your hiring strategy. Given the record-low employment rate, today’s job seekers are more selective than ever before when making career moves, so your career site gives you the opportunity to sell applicants on the opportunity of joining your team. And one of the key tools for showcasing your employment brand is your career site.
A compelling career site can help you attract top candidates at your hotel, as the most engaged candidates tend to apply to jobs through career sites. On your career site, highlight the benefits of working for your hotel, including company culture, benefits, opportunities for continued training and learning, and employee testimonials. A strong employment brand and comprehensive list of benefits can lead to strong hires and help contribute to employee engagement.
In addition to helping you hire your best team, a top-notch employment brand and career site can help you attract new customers at hotel. When potential customers research hotels for their next trip and see you invest time and resources into hiring quality employees, they’ll be more inclined to stay at your hotel than with a competitor.
Support an engaging candidate experience
When job seekers apply for your open roles, they’re likely applying to several other hotels and open positions outside the industry, so your team needs to make the candidate experience as engaging as possible – or you’ll lose talent to other opportunities.
A great candidate experience starts with reviewing applicants quickly. In our 2023 State of Hospitality Hiring Report, we found that over half (60%) of hospitality applicants would like to be interviewed within days. If your hotel did the same when it comes to prospective guests requesting a room online, you’d likely lose business to competitors who respond quickly – and the same goes for responding to job applicants. By reducing the time to review applicants, your team will have a better chance of securing quality candidates and you’ll decrease the overall time to hire, which will contribute to increased productivity and profitability. Acting on applicants is especially important given the record-low unemployment rate, as there are more open roles than available talent to fill them, so top talent will get hired sooner rather than later.
Beyond reviewing and responding to applicants as soon as possible, your hiring team should continuously communicate with candidates throughout the hiring process, to keep them excited about joining your team. To keep candidates engaged, outline each step of the hiring process so candidates know what to expect and when. And consider implementing technology to make the hiring process easier on candidates, such as text messaging to streamline interview scheduling or automated reference and background checks. Any extra step your team can take to meet the expectations of today’s job seekers will help you secure talent no matter the economic conditions.
An effective hiring strategy is critical to the success of any hotel. When your hotel isn’t fully staffed, this can lead to turning away business or offering a poor experience to the customers you do have – such as long check-in lines and delayed room cleaning. And this poor experience can lead to customers opting for a competing hotel – and potential negative reviews. With stiff competition in the hotel industry – including similar hotels, Airbnb and other options – customers have countless options to stay elsewhere, so building the best team and offering great customer service is a must.
