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Why US hotels are missing more than 238,000 employees

Tan KW
Publish date: Fri, 22 Sep 2023, 12:03 PM
Tan KW
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NEW YORK: Tourism is back in the United States - but hotel workers are not.

Hotels and resorts learned to operate with leaner staffing models during the pandemic.

Three years later, Covid-era band-aids like self-service kiosks and less frequent housekeeping have now become the new normal for many firms seeking to cope with rising labour costs and perpetual vacancies.

While employment in a variety of industries has now surpassed 2020 levels, the accommodation industry currently employs about 238,000 fewer workers than before the health crisis - a hole that’s likely to persist.

Companies are seeing these initiatives “as a solution to the efficiency issues,” said Alexi Khajavi, president for hospitality, travel and wellness at Questex, an information services firm. But there’s “also just simply the fact that they don’t think that the labour issues are going to be fixed anytime soon.”

Nowhere in the United States is the fallout more apparent than in Las Vegas, where one in four people are employed in the leisure and hospitality sector. The more than 17,000 shortfall of workers in the city’s accommodation industry has left the unemployment rate at 6.1% - the highest among any major metropolitan area in the country - despite job growth in other industries.

Technology is on full display across Las Vegas.

Major hotels allow guests to access their rooms without much human interaction with self check-in and mobile-entry. Drink-dispensing machines are mixing up cocktails at resorts like the MGM Grand. And robots named Elvis and Priscilla are making room deliveries at Marriott International Inc’s Renaissance.

The distrust toward new technologies and cost-saving measures could ultimately help spark the Culinary Workers Union’s first citywide strike in almost four decades. Contracts covering 40,000 union members just expired, and a strike vote is scheduled for next week.

As drink-dispensing machines have gained ground in recent years, Holly Lang, 45, has seen close to 20 bartenders look for new jobs. Starting at about US$40,000, companies can get one of Smart Bar USA’s automated dispensing machines fully installed, and its employees trained to use it.

The machines can dispense drinks quickly, with the help of fewer bartenders. But Lang, a unionised server who’s been working at MGM Grand for nearly two decades, said the new technology requires her to balance more tasks.

Machines can get clogged or don’t process the orders she puts in, putting her in a tough spot with customers, she said.

“We’ve kind of had to take on the role of bartending even though that wasn’t something that we actually signed up for,” said Lang.

The service robotics industry is projected to reach US$216bil in 2030 as staffing shortages accelerate the need for automating processes like customer service and cleaning, according to the research company GlobalData Plc.

Smart Bar Co-managing member Barry Fieldman says his products weren’t developed to replace workers but to make their jobs easier instead. Bartenders can make more drinks, earning more money for themselves and the business. It’s “a win-win proposition,” he said.

Recent cyber attacks at both MGM Resorts International and Caesars Entertainment Inc show how technological advancements can also come with new challenges. The attack disrupted MGM’s websites, its reservations and payments systems as well as some slot machines at its casinos.

Many hotels, however, are just providing fewer guest services, whether that’s less frequent housekeeping or reduced operating hours for the front desk, bar and pool. More than one in four hotel operators said the front office function would be phased out of their properties within the next five years, according to a recent survey.

 - Bloomberg

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