Top challenges with Human Capital in 2023
We are all well aware of the current challenges when it comes to finding staff within the Hospitality industry. The paradigm shift occurred mainly during (or because) the pandemic. “The great resignation” saw many people leaving their jobs, or not returning to the ones they were fired from during the lockdown. They were not willing to accept the same conditions that were offered to them before 2020.
Also, many people’s aspirations have changed. Where there was a large number of employees in the 20th century devoted to their career, working long hours every day aspiring to get that promotion and truly identified with the company they worked for; we find now a younger generation that couldn’t be more removed from that.
Reasons for the hospitality challenge
As mentioned, the big resign has not only affected the hospitality industry. Almost every industry has been hit by it, one way or another. However, the tourism was hit particularly hard during the pandemic as the lockdown had devastating effects on most companies.
Millions of employees were fired/their roles made redundant as companies -in many cases SMEs- could have not survived otherwise.
Those people who found themselves jobless, were often work migrants who were at that location only because of the job they had. In the new scenario, they went back home and searched for new -often unrelated- jobs.
When the hotels, bars or restaurants who had fired them called them back to return to their old role, most people were comfortably working elsewhere, and in most cases with better conditions, and declined the offer. That happened globally, and it was a major issue both in the UK after Brexit; at the Mexican Riviera; or in Vietnam where inland locals refused to go back to the coastal or island resorts.
New motivators
On the other hand, we have mindset reset that has been happening over the last few years. According to a research performed by BCG, the new ranking of preferences and motivators for employees are:
- Feel appreciated/valued
- Have a good relationship with peers
- Positive work/life balance
- Good relationship with management
- Financial stability
- Learn and be able to develop
- Permanent contract
- Attractive salary
In the past, offering a more attractive salary used to be enough to keep talent, or attract new one. Now, that is only the 8th top reason to stay at a post, or look for a new one. And in an industry like ours with challenging shifts, open 24/7 and handling customers face to face, it’s not easy to fulfil these preferences anymore.
Besides, there is a major global workforce challenge. In most developed countries, a labour shortage is expected to happen within this decade. In some cases, such us Germany (-23%) or South Korea (-26%), the shortage is really concerning.
Developed nations tend to have less and less children. And it’s true that automation will close the gap somehow in the future, but it will not be ready on time to cover for all those jobs that remain unfilled.
Most large hotel companies have thousand of open positions at any given time, and most struggle to find not just top talent, but even a single applicant.
Solutions to the challenge
More companies are starting to offer accommodation included in the package in destinations where it was unheard of (Mallorca), while others are reverting to trying and teach and develop their new staff from scratch (such as Riu, amongst others).
That solves only part of the problem, mainly the economic one. However, as mentioned earlier, there are other priorities and motivators in the younger generation’s minds nowadays.
“Feeling fulfilled/motivated” is #1. And that’s a challenging one to address, as it can be different from person to person. That’s why it’s very important for companies to engage in conversations with the team so that they can understand the individuals better, and try to be able to offer the flexibility that they can afford.
And for that one does not need a HR department. It can be an honest conversation over a cup of coffee between bar owner and waiter. The times of imposing rosters without asking, the “take it or leave it” are well over.
For many restaurants in the past in resort destinations, running operations 7 days/week with the same staff over the entire season with no days off was a norm. No surprise then there were tense situations.
#2 and #4 top motivators are related: have a good relationship with colleagues and management. Can you imagine the atmosphere at those kitchens? Younger generations are tired of back stabbing, “politics” and “do what it takes” at work. They prefer a more chilled environment, where they can enjoy a positive atmosphere to avoid the burnt-out syndrome that has been the norm in the past years.
It’s true that sometimes the pace at a kitchen of a very busy restaurant can create tension at work, but it’s not less true that this atmosphere is created by the team working there, and it’s their responsibility to fix it, starting from the management and what they expect from their teams. At the end of the day, if you need to run a kitchen with the team can not even enjoy days off, then maybe that kitchen is not that well run.
Finally, it’s worth mentioning the #3 top motivator: work/life balance. The one that we all thought it was impossible in a business that operates 24/7 every day of the year. However, although it’s true that for some roles changing shifts are necessary, it’s not less true that there are ways to make it as flexible as possible for the team. Why would every team member at the Front Desk need to rotate shifts weekly? Some restaurants are opening now five days a week, partly because of staff shortage, true. But partly also because they want to make sure the current staff can get that work/life balance the workforce is demanding.
The time to adapt is now
During the pandemic, many low paid professionals from the hospitality industry left it to go work for logistic companies, whose operations boomed during that period. It’s challenging to understand that working at a warehouse can be more appealing than working at a Hotel or restaurant. We should look back and check what were we doing wrong when it comes to people management, so that we can entice those professionals to return.
And that applies also to the teenagers deciding whether to study or not hospitality related degrees. The industry has got a (sometimes well earned) bad reputation that now less and less young students choose that path.
The little connection that exists between what it taught at Universities and what is needed in real life in the business world does not help either.
So, approaches such as Accor’s one, hiring profiles based on attitude, and offering more flexible conditions fitting what the younger generations need, can be a great move towards having full teams, satisfied at work, ready to cater and serve at one of the largest global industries, that is at full steam again.
Are you ready to be flexible and adapt? Are you willing to do it? 2023 promises to be a great year for the tourism industry, and you want to make sure you make the most out of it. The time is now.
