Delivering Service in a Labor-Scarce Economy

By Mark Heymann Chairman & CEO, Unifocus | January 20, 2019

With unemployment holding at historically low rates, hospitality and food service are among the industries most affected by the labor shortage, according to the Bureau of Labor Statistics. The immigrant workforce, a vital source of labor for the hospitality industry, is being impacted by a government crackdown at a time when the U.S.-born population is aging and shrinking. Adding to the challenge is that with job opportunities outpacing available labor, more workers are targeting higher skilled (and higher paying) positions, leaving lower-paying service jobs unfilled.

For hotel operators to continue to meet guest expectations with lower staffing levels, ingenuity will be required, from rethinking how service is delivered to considering nontraditional labor sources that can be trained for hospitality work. And, they will need to examine how a lower-paying industry can attract a larger percentage of the shrinking labor pool.

Raising Wages While Minimizing Impact

Is it possible that the labor shortage could spur the industry to raise average wage rates? Most people assume that a wage increase automatically means a raise in base wage rate. This is not necessarily the case. The use of pay-for-skill and performance pay can increase wages while limiting the impact of the higher net wage on the organization. Pay-for-skill can be implemented in conjunction with cross-utilization, thereby reducing time lost due to minimum shift requirements.

This creates a job enrichment culture (improving engagement) and reduces the number of full-time employees, effectively reducing total benefit costs. A pay-for-performance structure can measure aspects of an employee's job, like quality results, shift production, and other individual or team metrics. This approach, sometimes called gain sharing, assures that as the employee's compensation increases, there is a direct benefit to the organization.

A Shift Toward Self-Service

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Coming up in June 2019...

Sales & Marketing: Selling Experiences

There are innumerable strategies that Hotel Sales and Marketing Directors employ to find, engage and entice guests to their property, and those strategies are constantly evolving. A breakthrough technology, pioneering platform, or even a simple algorithm update can cause new trends to emerge and upend the best laid plans. Sales and marketing departments must remain agile so they can adapt to the ever changing digital landscape. As an example, the popularity of virtual reality is on the rise, as 360 interactive technologies become more mainstream. Chatbots and artificial intelligence are also poised to become the next big things, as they take guest personalization to a whole new level. But one sales and marketing trend that is currently resulting in major benefits for hotels is experiential marketing - the effort to deliver an experience to potential guests. Mainly this is accomplished through the creative use of video and images, and by utilizing what has become known as User Generated Content. By sharing actual personal content (videos and pictures) from satisfied guests who have experienced the delights of a property, prospective guests can more easily imagine themselves having the same experience. Similarly, Hotel Generated Content is equally important. Hotels are more than beds and effective video presentations can tell a compelling story - a story about what makes the hotel appealing and unique. A video walk-through of rooms is essential, as are video tours in different areas of a hotel. The goal is to highlight what makes the property exceptional, but also to show real people having real fun - an experience that prospective guests can have too. The June Hotel Business Review will report on some of these issues and strategies, and examine how some sales and marketing professionals are integrating them into their operations.