COVID-19: Impact on the hospitality workforce

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The World Travel & Tourism Council has recently warned the COVID-19 pandemic could lead to a cut 50 million jobs worldwide in the travel and tourism industry. EHLEducation EHLServices ENG Français Deutsch Insights BusinessManagement CulinaryArts HospitalityIndustry StudentResources TrendsinEducation Subscribe Home HospitalityIndustry COVID-19:Impactonthehospitalityworkforce HospitalityIndustry 4minread COVID-19:Impactonthehospitalityworkforce Writtenby SukritDogra TheruthlessmarchofCOVID-19throughouttheglobeisfirstandforemostahumantragedy,affectingthehealthofhundredsofthousandsofpeople.Theconsequencesofmeasurestakenworldwidetocurbthepandemicarehavingagrowingimpactontheglobaleconomy.Thisarticleaimstoofferkeyhighlightsontheimpactbeingfeltbytheindustryduetofactorsincluding,butnotlimitedto, themigratorynatureofthehospitalityworkforce andthepauseonglobaltravel, tourism andrestaurantservices. Businessimpactontravelandtourism Accountingfortheunprecedentedtravelrestrictions,theUnitedNationsWorldTourismOrganizationexpectsthatinternationaltouristswillbedownby20%to30%in2020,whencomparedtothelastyear.Toputthisintocontext,theyalsodrewacomparisonfromtheSARSoutbreakin2009,whichledtoadeclineofjust0.4%oftheinternationaltouristmarket.Thehospitalityindustryaccountsfor10%oftheglobalGDP. Disruptionstoproduction,initiallyinAsia,havenowspreadtosupplychainsacrosstheworld.Allbusinesses,regardlessofsize,arefacingseriouschallenges,especiallythoseintheaviation,tourismandhospitalityindustries,witharealthreatofsignificantdeclinesinrevenue,insolvenciesandjoblossesinspecificsectors.Sustainingbusinessoperationswillbeparticularlydifficultforsmallandmediumenterprises. InIndia:Thehospitalityindustryislikelytobehithard.ExpertssuggestthatdomestichotelcompanieswillfaceaweakQ4FY20andaweakerQ1FY21.Marchhasbornethebruntofmanylarge-scalecancellationsacrossthecorporate,MICEandleisuresegments.Tier2 andtier3 hotelmarketsinIndiacontinuetowitnessasmallerosioninbusinessfornow.OccupanciesinatleastthefirsthalfofMarchwereonlypartiallylowerdespitethespreadofthevirusinsomestates, InEurope:Industryexpertshaveattemptedtopredicttheeffectupontheglobalhotelindustryfor2020,estimatingaprofitdeclineof11-29%.TheKHN,whichrepresentsbars,cafésandhotels, hassaidthattheemergencymeasurestolimitthespreadofthevirusarealreadycausingaseriousimpact.Cancellationshaverisenbyalmosthalf-theKHNsurveyfoundthathospitalityownersbelievethattheycouldmakelossesof33%duetotheemergencymeasuresputinplacebythegovernment.   InChina:Comparedto2019figures,occupancyisdownbyasmuchas68%.AsChinawasthefirstmarkettodealwiththecoronavirus,itisalsothefirsttoshowsignsofstabilization.Asperdata,87%percentofthecountry’shotelsarenowopenandoccupancyisbeginningtorise. Othercountries: HotelsacrosstheU.S.areexperiencingunprecedentedbookingcancellationsduetothepandemic,whichcouldeliminateuptofourmillionposts(thisaccountsfor50%ofallhoteljobsinAmerica).TheaverageoccupancyinItalyisdownby96% ;theUnitedKingdomisdownby67%. Impactonjobsinhospitality TheWorldTravel&TourismCouncilhasrecentlywarnedtheCOVID-19pandemiccouldleadtoacut50millionjobsworldwideinthetravelandtourismindustry.AsperanOxfordeconomicsstudy,Asiaisexpectedtobetheworstaffectedanddatasuggeststheindustrycouldtakemanymonthstorecover. Followingtravelbans,borderclosuresandquarantinemeasures,manyworkerscannotmovetotheirplacesofworkorcarryouttheirjobswhichhaseffectsonincomes,particularlyforinformalandcasuallyemployedworkers.Giventhecurrentenvironmentofuncertaintyandfear,enterprisesarelikelytodelayinvestments,purchasesofgoodsandthehiringofworkers.Asperdata,theimpactontheIndianhospitalityindustrycouldrenderamajorityofthepeopleinhospitalityinIndia,jobless.Asaresultofthispandemic,theIndiantourismindustryislookingatpanIndiabankruptcies,closureofbusinessesandmassunemployment. Overall,itmaybethatthenatureofhotelsandrestaurantswillchangetoleanerandmoreefficientoperations,whereabalancebetweensmartandskilledlabourissoughtafter.Duetofear,alargepartofthelabourforceisseeingadomestic-massimmigration,whichmeansamajorityofthefrontlinestaffathotelswillhavemovedbacktotheirnativeareas. Temporaryworkforceswillbethefirsttoshrink,afterwhichtheimpactwillbefeltbypermanentemployeesashospitalitycompaniesmaybehard-pressedtocutcosts.Thismayleadtoalargenumberofpeoplechangingtheirindustrytogowherethecashflowisquicker.Thisglobalexoduscouldhaveasevereimpactonthetalentpoolandmaynotrecoveruntilconfidenceisreinforcedbyemployersandgovernmentsalike.Onlythroughacompassionateapproachtakenbybusinessescantheworkforcebesaved. Reversingtheimpactonthetalentpool Withtheincumbentlay-offs,itispossibletoofferupskillingopportunitiestofront-linestaff,soastobeefuptheirresumesandincreasetheirprobabilityinsecuringajobatthetimeofthemarketup-turn.Thiscouldcurbmass-migrationtotheotherindustriesthatcouldincreasethegestationperiodofthehospitalitymarket’srecoveryphasebyreducingspecializedworkforce.Inthisscenario,thetrainingandupskillingofareplacementbatchwouldtakealongertimetorecover–causingcompaniesinnumerableissues.However,innovativemethodscanbeappliedtoaidthemarketinboostingandpreservingthenumbersforwhenthemarketfinallynormalizes. Opportunitiestoupgradetheskillset Up-skill Creatingopportunitiesforhotelemployeestoaddvaluetotheirskill-setscouldbuildconfidenceinhotelcompanies,aslayoffscanbeexpectedbyallmajorandminorhotelcompanies.Hyper-localhotelsmayseethelargestnumberoflayoffsduetothepopularasset-lightmodel,wherelargenumberofoperatingunits,scatteredacrosscountries,couldbewrittenoffallatonce.Thiswillbleedoutavastnumberofhospitalityemployeesintoanalreadydifficultmarket.Individualswhocanupgradetheirskillsetsbywayofenrollinginspeciality-specificcoursescouldbenefitgreatly. Re-skill Offeringroutessuchas‘RecognitionofPriorLearning’opportunitiestoqualifiedhospitalityfront-lineprofessionalscouldacceleratetheprocessinre-skillingindividuals,hencepreparingthemforrolesinhotelsandotherhospitality-relatedoperationsinanenvironmentwherelean, yetskilled operationswillberequired. Otherinnovations Continuous education Hostingonlineclassesinordertomakeupforlosttimeduringthisperiodcouldbehighlyadvantageousforstudentsandinstitutions.Thiswouldallowinstitutionstore-groupandconductlivesessions,ensuringsomecashflowandreducingthestressontheirrespectiveplansfortheircohorts.ModernLearningManagementSystemsallowthehostingandremotedeliveryoftheircontentviaasimpleself-learningapproachoraone-to-manyclassroomstyledelivery. Technologythatiscurrentlyavailabletousallowsforalotofcreativemethodstoensurecontinuityinlearningthatwillsurelyseethelightofdayasnecessityalwaysbreedsinnovation. Atnopointinhistoryhassuchanincidentoccurred,wherebusinessesinalmost200countrieshavebeenparalyzedduetoacommonfactor.Onlytimewilltrulytellthefull impactofCOVID-19ontheglobalbusinessscenario.Thelandscapeofhospitalitycouldpossiblychange forever,andinordertostayrelevant, wemustfindcreativewaystosecureourindustry.Avastamountofresearchonglobalhospitalitytrendsisbeingsharedontheinternet,whichcanhelpinspireparadigm-shiftingideas.However,adoptionofthoseideasbythemarketwillbekeyinfindingthelightattheendofthetunnel.Itispossiblethatemployersandgovernmentswhoremainconnectedandconcernedabouttheirresources decidetoretainamajorityoftheirpeople, therebyreducingthestressontheirHRcycleandgivingthemthecompetitiveadvantage.   Tags: EHLAdvisoryServices HospitalityIndustry Coronavirus HospitalityExpertise OperationalExpertise Writtenby SukritDogra ConsultantatEHLAdvisoryServices Gotastorytoshare?BecomeanEHLInsightscontributor Keepreading EHLAdvisoryServices Article MedicalSpaTrends2022 EHLAdvisoryServices Article ImpactInvesting:Whyinvestineducation? 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