How to Deal with the Hospitality Labor Shortage in 2020 and Beyond
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How to Deal with the Hospitality Labor Shortage in 2020 and Beyond
If you’re managing a restaurant, a diner, a hotel, a bar, whatever sector the hospitality
industry touches, you already know a universal truth: there’s a significant labor
shortage. We see it every day because we talk to frustrated business owners, general
managers, shift managers. Basically, everyone – people in the greater hospitality
industry are looking for a lifeline. The seas of commerce are rough out there. And the
waters aren’t getting any calmer.
You’re probably asking, “wait, who are these folks? How do they know what’s going
on in the industry?”
We’re Adia, the on-demand staffing platform for hospitality. We give you full
visibility into your workforce 24/7, and access to a worker pool 10x bigger than your
agency’s. No contracts, no middleman, no red tape. Just workers that actually show
up.
We’ve got firsthand experience in helping solve the Rubix cube of staffing during the
massive shortage happening right now. There’s a lot to consider and even more to
figure out, given the strength of not only local economies but the national one, too.
We may not have a crystal ball, but we can sure tell you about everything we’ve
learned so far. With 2020 looking like it’s going to be another year of growth across
the board, people should be informed because GM’s don’t want to get left behind.
And with how things are trending upward, information is everything. Otherwise,
expect a lot of unhappy investors and boss’s bosses.
Busy is only getting busier
No matter if you’re booking a hotel room or trying to grab a pizza at the local spot,
fewer and fewer people are behind the desk or tossing the dough. Good people are
getting harder to find. Thanks to a strong economy and low unemployment rate,
managers in all kinds of industries are scrambling to find solutions when it comes to
filling vacancies.
1Right now, we’re sitting at a 3.5%
unemployment rate nationally. That’s not
exactly what you’d call a slump. There are more
jobs than people. On the one hand, it’s a good
thing for the country, but it’s a whole different
ball game for general managers trying to keep
their service industry business running at top
speed.
Getting proper help and retaining staff have
long been pain points for restaurant operators,
but today’s market has been a whole different animal. According to Toast, 51%
of restaurant owners cite hiring, training, and retaining staff as their number one
headache in 2019.
And places to grab a bite aren’t the only ones feeling the squeeze. Hotels are also
dealing with a significant labor shortage, too. We’ve moved into a service-based
economy, more people are eating out and traveling. Look at these two stats:
• The National Restaurant Association projects overall industry sales will
hit a new high of $863 billion in 2019, up 3.6% year over year, according
to CNBC.
• According to Newsweek, the travel industry has jumped up to $135
billion annually. Right now, there are over a million unfilled jobs within the
hotel industry.
What’s next for hospitality in
2020?
2In the past, the manager could rely on the teen
workforce to fill up positions across the hospitality
industry. Today’s teenager is wired differently. The
U.S. Bureau of Labor Statistics projects the number of
teens in the labor force to plummet by 660K over the
next decade as teens are choosing entrepreneurial
opportunities, as well as volunteer and community
service gigs – why? They look good on college
resumes.
Hotel and restaurant and general managers are scrambling. With record numbers of
people looking for a room or a place to get lunch, management can’t sit passively,
not with the flux of equity that’s available. A slow workforce can’t stop upward
momentum.
In the past, a traditional staffing agency had been a necessary evil. But that model
can’t keep up with the sheer amount of jobs that need to be filled. With those
massive hospitality numbers trending upward, it’s not feasible for hotels, motels,
restaurants to play “sit and wait” while they cast a broad net and hope for the best.
(That’s why we’ve been helping transform the hospitality sector with our transparent,
no B.S. process.)
Thinking about
the big picture
What roles need to be filled?
When it comes to the restaurant industry, the
needs are typically back-of-house: chefs, line
cooks, dishwashers. But, there’s also a need
for servers and bussers.
3One of the most significant contributing factors to the shortage is that more people
are opening places to grab a bite to eat. The restaurant industry is projected to
experience a 6% growth over the next decade. According to The Bureau of Labor
Statistics, the restaurant industry will need a total of 150K cooks by 2026. Right now,
there’s just not enough talent to go around. The long wait times and scrambling staff
are indicative of the growing problem.
The Bureau of Labor Statistics projects 14% growth for “food and beverage serving
and related workers” over the next decade.
Thanks to so few workers available, the customer experience is suffering. Without
people there to cook the food, bus the tables, or greet folks at the door, that leads
to staff doing more with less, despite customers ready to sit down. Customer
experience is everything in dining. If that’s affected, it’s a major problem.
It’s not just restaurants
feeling the squeeze
When it comes to hotels, the numbers are even uglier. There are over a million open
hotel jobs. And not just people at the front desk, but every part of the business. With
record numbers of people traveling, hotels risk being left in the dust.
4The New York Times reported that there are more travelers out there checking out
the big cities, but also the small towns, too. Guest rooms rose to 5.3 million in 2018
- with a 66.2% occupancy rate - which is a 30 year high. And with those numbers, the
guest experience will suffer.
When it comes to hotels, there’s a mixture of three factors:
• Location
• Price
• Amenities
People can make excuses for location and price, but amenities are a huge x-factor
in how quick customers will abandon ship and leave a bad review. With such a
transparent culture, thanks to sites like TripAdvisor, Google Reviews, and Yelp, there’s
no room for error. People stop in for coffee, they want to grab a bite to eat at the
bistro, they’ll hit the pool and the spa. But, if there aren’t enough people to staff these
positions, the customer experience suffers.
A report released last year by Oxford Economics on behalf of the American Hotel
and Lodging Association (AHLA) cited that over 2,270 hotels, motels, inns, and bed-
and-breakfasts have popped up in the last three years. That brings the number of
properties in the U.S. up to around 56K, which is a ton of new rooms. There’s just too
many people traveling, and hotels can’t keep up.
What roles does the hotel industry need right now?
Well, they need everything. Hotels are severely understaffed, as we’ve pointed out
over and over. Right now, there’s a critical need for:
• Housekeepers
• Maintenance
• Guest services
• Food and beverage
5What can the hospitality
industry do?
With a smaller staff and slower pace,
you’ll lose the number of guests served
and checks you do in a night. With less
money coming in, you’re left with a
smaller operational budget that’ll affect
purchasing decisions. Some smaller
hotels are changing how they approach
the idea of the “front desk” with a series
of iPads set up for guest check-ins while
a team member walks around with a
separate iPad to help accommodate
guests for specific needs.
There has to be a better way. Thankfully, there is.
Technology has moved at lightning speed over the last few years. It’s changed how
companies get help. In the past, the hospitality industry has had to hope for the
best with placing ads in the paper, promoting themselves with Indeed, and using
traditional staffing agencies to help fill the holes. Today, they don’t have to do all
that. They’ve got a secret weapon: Adia.
So how do we do it? It’s actually a lot easier than you think. Instead of getting lost in
the red-tape nightmare of hidden fees and endless surprises with traditional staffing,
we 86ed all of that. We’re the on-demand staffing platform that helps businesses of
all sizes move away from traditional staffing. And everything is on our app. We like to
keep things easy.
6Just say NO to traditional
staffing in 2020
The thing with traditional staffing is that it’s a flawed process. Mostly, they’ve cast a
massive net with limited workers and hope for the best. We wanted to change that
process.
Traditional staffing takes forever because it was never designed for speed. Agencies
have to call workers, see if they’re available, and, one by one, piece together a
collection of people who can show up. And then, it’s a crapshoot. There’s no rating
system, no way to know if the workers showed to the job. Most of the time, they
don’t.
Because our platform is so effective, we slashed the no-show rate by 50%. No-shows
mean chaotic planning, scrambling, and less work getting done. With the climate
we’ve talked so much about, that’s unacceptable.
Adia puts managers in control. Instead of relying on a hope and a prayer of
traditional staffing, managers set the terms:
7• You set the dates and times
• You set the hourly rate
• 24/7 visibility into roles being filled
• Reject or like specific workers
• No contracts
• No broken promises
Managers can offer comments like dress code, where to show up, anything. They
can also watch roles get filled in real-time.
Every dollar spent is transparent.
With traditional staffing, there’s a fixed SLA (Service Level Agreement) and not a lot
of room for tweaking the job should there be any changes. At Adia, we don’t make
our clients sign contracts.
It’s Easy to Stay Informed
Without a rating system, feedback, or general comments on a worker’s skill, or even
a profile they’ve set up to showcase abilities, how is a boss supposed to know what
kind of worker will be showing up? If a worker could cite that they’re OSHA-certified
or that they have an extensive serving or bartending
experience, that’s helpful.
A staffing agency is supposed to save you time,
not waste it. With Adia, you keep tabs on who’s on
the roster, reach out to workers, check profiles, all
by logging into the app. A manager can see every
role filled, and if they’d like to learn more about
that worker’s specific experience, they can send
a message. If they don’t like that worker, they can
block them from future bookings.
8On the flip side for a worker, with this new service-based economy, adoption
rates move faster. Workers are more likely to sign up for a new service, to be in a
community that’s app-based rather than go into an office to sit there and deal with all
the paperwork.
Want a big bonus of working with Adia before we go? If you’re a G.M. this is
important:
Our workers are all on a W-2 with us, not the company utilizing their help. We’ve
got the paperwork in order, including a background check. This makes it easier
for companies to work with us. It’s ala carte, you decide what you need. You’re not
hiring someone, but using Adia as a service. You can write it off on your taxes as
a business expense. With this economy, a lot of managers have a temporary help
budget. This makes spending that money smarter because it’s all contained within
the Adia community.
If Adia sounds like the solution you’ve been looking for, we’d love to connect and
help your business. There’s a lot of work to be done. Moving forward beyond 2020,
the hospitality world is only going to keep evolving. Being prepared is critical.
Learn More
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