Talent Demand vs. Available Talent: The Dwindling Hospitality Talent Pool

By Frank Speranza President, Hospitality Talent Scouts Executive Search | March 18, 2012

The U.S. Department of Labor reported an 8.3% unemployment rate in the U.S. as of January 2012. While that number has been gradually declining, everyone, politicians, business people, and economists included, agrees unemployment is far too high. Most also agree that without lower unemployment, we cannot experience real economic growth. Month after month, investors wait for the reported unemployment results; and depending on the outcome, we usually see some type of reaction from Wall Street. One can't turn on the news or look at a newspaper or business magazine without reading something about how high our unemployment rate is in the U.S. So if everyone agrees that unemployment is too high, why are hospitality employers having such a difficult time filling key managerial positions? I believe there are a few significant reasons for this, some of which no one in our industry really wants to talk about. Let's examine the scenarios that I, as a supplier of talent, have witnessed firsthand as some of the reasons for this lack of available talent.


Billionaire Sam Zell, who just appeared on stage with Bill Marriott at the American Lodging Investment Summit in January, told of how he had spoken just a few weeks earlier on CNBC about a company he has a controlling interest in called Anixter International. Zell told CNBC that college students should look at the unemployed for career guidance. "Did they major in engineering or literary arts?" Zell said. "Did they, in effect, take responsibility and say I have to provide for myself or I better have a college education that converts into a real working opportunity? As far as I am concerned, I don't know of too many engineers who are unemployed." Zell cited Anixter's experience in seeking to open a plant in Illinois. The company found there weren't enough qualified applicants. "We can't fill the plant with workers to make fasteners because in order to make fasteners, you've got to be able to read plans, and we can't find people who can read plans and specs and who are vocationally trained."

While those of us in hospitality are not making fasteners, we are still seeing some of these same things. Sam Zell appears to be suggesting that we have a training and qualification problem, and that if we dealt with it, maybe we would not be having this huge unemployment problem. I think he is onto something big, although I certainly don't think it's the whole story for those of us in hospitality. But it did lead me to ask myself this question: Where have all the Corporate Management Training Programs gone that existed in our industry in the 1970s and 1980s? We all know that companies recognize the need to invest in the future; however, expected operating margins of the 2000s have dramatically changed the landscape. That, along with a newer complexity in positions and downsizing of organizational structures, caused the old "doing more with less'" attitude to emerge; it also meant curtailing or eliminating many of the corporate development programs. This, I believe, had a huge effect on today's available quality talent pool that everyone is seeking.

Ken Blanchard, author of over 30 best-selling books on leadership, said in a public speaking format that you have two choices when you hire a new employee: hire a winner or hire a potential winner. He went on to define a winner as someone who knows exactly what you want them to do, when to do it, how to do it, and who delivers precise results with little or no supervision. He said the only problem with winners is they come at a premium, and you have to compensate them well. He said people always ask him, "What if I don't have the budget to hire a winner?" To which he responds, "If you don't have the budget and can't hire a winner, then your next best choice is to hire a potential winner. However, with a potential winner, you have to train them." He said this is usually followed by a second question that goes something like this: "If I can't afford a winner and I don't have time to train a potential winner, what would you suggest?" He had a one-word response: "Prayer." After the laughter died down, he said that's the only thing you have left if you don't want to do either of the first two. I concur that today our industry has failed to do all three, and I believe this is one of the reasons we find ourselves with a high demand for talent and a limited talent pool.

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