The hotel sector is facing greater than ever skills shortages, for a multitude of reasons. Although COVID played a key role in depleting the workforce considerably, the staffing challenge was brewing long before 2020. And as the sector faces record-breaking shortfalls in supply, hoteliers are realizing that the old ways of attracting, hiring and retaining employees will simply not bridge the gap. As a result, they’re looking at more innovative ways to manage the crisis — from new approaches to recruitment and scheduling to outside partnerships and technology innovation.
Although a lot of economies have grown significantly or stabilized since the pandemic, accommodation, which accounts for 20 per cent of the tourism sector, is the one industry that continues to grow and is the most impacted by the labour shortage, says Philip Mondor, president and CEO, Tourism HR Canada in Ottawa. “Accommodation is still lagging the rest of the tourism sectors in recovery. With all the demands and staff shortages, more workers that went elsewhere are not returning. The pool to draw from is smaller than we have ever seen.”
The tourism sector in Canada has 170,000 job vacancies, he adds. “We anticipate that an additional 330,000 will be needed to fill demand this summer. Tourism overall might be able to fill 200,000 to 250,000 if things go well, which means there will still be a shortfall of at least 220,000 workers no matter what you throw at this. Even with changes to immigration policies and quotas, there will continue to be a lag.”
Supply issues are exacerbated by additional residual challenges that are affecting the industry since the pandemic, including employment barriers, affordable housing and transportation, mobility of workers and childcare, he adds.
The root cause dates back at least 20 years with the demographic shift. “For 20 years we have had an aging population with not enough younger workers coming in. In the last two-and-a-half years, retirement rates have accelerated higher since the pandemic,” explains Mondor. “It’s not just frontline workers. We have lost tenured and skilled talent at rates we’ve never seen before.”
Finding the Gaps
One noteworthy issue that came out of the pandemic is the impact furloughs had on women. “Up to 80 per cent of people in the industry are women,” says Ian Milford, principal, JRoss Hospitality Recruiters in Vancouver. “They all found different jobs.”
Joanna Jagger, founder, WORTH Association, and instructor, School of Tourism at Capilano University in Vancouver, has been studying data across the accommodation sector. “When COVID hit, young and racialized women were hit the hardest in terms of loss and the industry has not been able to fill that gap at a rate to meet the increased demand. When women lost their jobs, fewer returned, partly because of the impact of burnout and responsibilities at home. They are choosing not to work in operational roles.”
Women are not the only group where candidates are less than willing to join the fold. Younger-generation workers are also challenging to find, as Gen-Z workers are less inclined to consider the hospitality sector in general.
“Recent research shows that Gen-Z workers are very values driven and want to work for employers that share those values,” says Adrienne Foster, vice-president of Policy and Public Affairs for the Hotel Association of Canada (HAC) in Ottawa. “They are looking for flexibility, perks, and having a great working environment, which are areas hoteliers should be looking at.”
The way younger people apply for and get jobs is also changing, she adds. “The younger generation doesn’t want to fill out forms on the Internet. If they can’t do it on the phone, they are less likely to be interested.”
The Tables Have Turned
Gone are the days when six people applied for one job. Today’s workers are in such high demand, they can decide which job they want, notes Milford. “Candidates have more options. If you continue to throw ads up on Indeed and don’t treat them like the precious commodity they are, they will go somewhere that does.”
Work used to be a transaction between an employer and employee, he adds. “For today’s candidates, it’s a relationship. They are there to earn money and do the job you are paying them to do. It’s not their responsibility to make sure you are making a profit or manage the business.”
He says employers have to think differently about the way they have looked at recruitment. “The seasonal, less experienced workforce that helps fill demand in peak periods tend to be younger, with less work experience, education, or training. They account for one-third of the workforce. You can expect higher turnover, because they tend to go back to school or transition to other careers.”
It is the other two-thirds — the tenured occupations and professions – that hoteliers need to do a better job around in the way of retention, career advancement and development, says Mondor. “Even if those people move on to other forms of employment, the metrics show a high return on investment, because of their higher productivity and tendency to stay longer.”
Employers also need to move away from their normalized recruitment and retention practices to find ways to work with fewer staff. The blended-workforce model is one option that is on the rise, says Mondor. “It may be better to work with an anchor team augmented by part-time, casual and freelancers. Some hotels are considering more formalized arrangements with other employers that may not even be in the sector to do complementary scheduling.”
Changing the Industry Narrative
Unfortunately, the hospitality sector has been taking a hit on the reputational front. “It’s not just an issue of the number of workers. People’s perceptions of working in tourism in general has eroded,” says Mondor.
While wages have actually increased across the board and hotels are competitive, the perception is that it is a low-paying industry, says Jagger. “That’s not accurate. Not only do employers pay competitive and living wages, they also offer benefits other sectors don’t, such as extended health and dental, travel re-imbursement, discounts and passes.”
Industry perception of career path and progression is a big problem, especially within leadership roles, she adds. “We are finding, for example, that the industry does not support working parents’ scheduling demands and childcare provisions. With the decline in accommodation during COVID, we saw a lot of women move to professional services such as real estate, retail, marketing and public relations – any kind of management services where they could apply the skills they learned in the hotel sector.”
Government programs in the works
The good news is government at various levels are taking notice, although those efforts at workforce recovery have not been cohesive and can be difficult to navigate, says Mondor. “Everyone is throwing [solutions] at this hoping to get results, but it’s not coherent and there is a lot of duplication. Money is going in, but is it doing the right thing?”
Milford believes much more can and needs to be done. The three key players need to work together. “The three key organizations — Employment and Social Development Canada (ESDC), “Employment Insurance (EI), and Immigration Canada — don’t talk to one another so, it is challenging for people to advantage of the programs that are available.”
Mondor points to some key initiatives on the part of the federal government around immigration that could prove fruitful. “There have been eight to 10 policy changes to immigration through various streams to increase the number of new Canadians we are bringing in. It has also created more flexibility and eligibility in occupations.”
“There is a need to support temporary foreign workers, while also ensuring immigrants can identify as skilled roles in hotels rather than unskilled roles,” says Jagger, adding the need for more investment in research to ensure the sector is putting more focus and investment into the root causes of the labour crisis.
HAC for one, has received a federal grant to study the issue of the hotel labour force in Canada in partnership with Deloitte Canada to research the issues, develop an action plan, and chart a new course moving forward.
“We spoke to every stakeholder that could touch on issues for hotels in Canada, as well as other countries to find best practices,” says Foster. “A ton of innovative ideas were brought to the forefront with this research and are now making sure any action plan we release is practical and viable for the industry.”
She stresses the importance of considering solutions form both a short-term and long-term perspective. “We need an immediate solution for the summer. The temporary foreign worker (TFW) program — as imperfect as it is — is the best bet to get the highest number of people in the country in time. We have had a number of wins on that, including an exception to cap the amount of TFWs at 30 per cent versus the rest of the economy at 10 per cent. This past fall the government announced TFW spouses will get a work permit as well.”
Over the long-term HAC is looking at solutions on the immigration side. “Currently it is set up to welcome people with advanced degrees. We have put forth a proposal to the Department of Immigration to create a dedicate stream for tourism workers and a path to permanent residency.”
Adding education to the mix
On the education front, there needs to be more emphasis on developing models with employers and educational institutions so students can gain workplace experience earlier, says Jagger. “Co-op and integrated-learning programs will allow students to be working while they study. Once they graduate, they are ready to enter a supervisory or managerial stream.”
The HAC research showed that educators and hotel employers are looking for tighter working relationships with educators to build curriculums that better reflect the skills needed today in hotels, including practicums as part of those programs, says Foster.
Milford also hopes to see governments remove some of the cost barriers to education for particular trades. “They need to support post-secondary education more at the vocational level. We have not invested money federally or provincially in putting people through Red Seal or apprentice programs.”
Works is also needed to educate immigrant settlement agencies about the industry, says Foster. “They are unaware of the different types of jobs available and are not recommending their clients apply. They don’t realize that many position don’t require perfect English-speaking skills.”
Work also needs to be done to shift perception of the industry and the opportunities for advancement, she notes. “It is a dynamic industry with unlimited opportunity. We need to amplify those opportunities and career paths people can take in this industry. It also means investing in HR practices to ensure the sector remains an employer of choice.”
HAC for its part has used the recent research to launch a marketing campaign focusing on high-school age to 24-year-old students to highlight the career opportunities.
A more promising future
Although the projections seem dire, the crisis is driving long-needed change within the sector, says Mondor. “There have never been greater opportunities to enter the field. It is in literally every corner in Canada and can offer more secure long-term employment and advancement than could be anticipated.”
The fact that sector challenges have gained public attention is another plus, he adds. “In the darker days of the pandemic, the public came to a better appreciation of the impact of the sector not functioning well. This visibility is important because it has enabled the industry to influence public policy including Canada’s immigration policy. We have a window of opportunity to see more of these kinds of investments and appreciation of what the sector brings to Canadians and not just the visitor economy.”
The labour challenge has also provided new opportunities for businesses to pivot, says Milford. “We have an opportunity to re-evaluate areas such as the hours of work and re-look at how things can be done at different times. For example, rather than having all housekeepers coming in at 7 a.m., why not stagger them so people with young families can drop of and pick up their kids at school.”
“The labour shortage problem is so massive there is no single solution,” says Foster. “But our latest project is telling us that everyone is eager to re-frame the way they are dealing with the labour market. There is a huge appetite for innovative solutions. To me that’s the most encouraging thing of all.”
BY DENISE DEVEAU
