Dr. Keneika A. Rowe, CHE, CHIA
Top Reasons Why Employees Are Leaving The Hospitality Industry
Hospitality leaders are constantly challenged with the difficulty of finding and retaining skilled talents to fill many positions across various sectors. A report from Hotelogix shows that the immediate loss of employees can cost employers up to 30% of their annual revenue in the hospitality industry. Flexjobs reported that 81% of employees would be loyal to their employers if they provided more flexible work options. The great resignation has contributed to the increasing number of job losses in the US. The great resignation refers to the number of people who voluntarily quit their job in 2021. In their article, Professors Joseph Fuller and William Kerr from Harvard Business Review mentioned that the US Bureau of Labor Statistics reported that 47 million Americans quit their jobs in 2021. The majority of employees from this source came from the hospitality industry, such as leisure, food and beverage, and accommodation. Research shows that the millennial generation has the highest resignation rate, while the older generations have a higher retention rate.
In September 2022, the US Bureau of Labor Statistics reported that job openings increased to 10.7 million. The most significant increase was in the accommodation and food services sectors, accounting for 215,000 job openings. In addition, a decrease in total separation of 3.7% and a reduction in the accommodations and food services sector accounts for 103,000.
Research shows that employees were quitting their hospitality jobs and moving to other industries for numerous reasons. Some of which include:
The fear of contracting the COVID-19 virus and taking care of their loved ones during the pandemic
Lack of work-life balance
To start their own business
Lack of flexibility
Burnout from being overworked
Lack of good health benefits
Age discrimination among older workers
Older workers who could retire early
Lack of daycare during school closures
A report from McKinsey Quarterly review in September 2021 suggested that leaders must listen and communicate with their employees to better understand how to meet their needs in the workplace. They reported that the most important factors for employees leaving their jobs were:
They want to feel valued by their organization and managers
They want to feel a sense of belonging
Some other factors that were somewhat important to employees were:
Lack of opportunity for advancement
Lack of flexible work schedule
Lack of trust and caring among teammates
Employers, on the other hand, thought that employees were leaving their establishments because of external factors such as:
Better job opportunities
Ability to work remotely
In 2022, Cnn Business reported a Miami Chick-fil-A owner/operator introduced a 14 hours work week into 3-day blocks for his staff in 20 locations. The Thirty-eight employees consisted of 18 store leaders, and 20 frontline employees worked alternated schedules. He experienced 100% retention and was inundated with new job applications. In addition, a 4-day work week, 32 hours per week, is also being introduced in many businesses to help eliminate employee burnout, promote flexibility, and increase productivity.
Serenity Gibbons, a Forbes contributor, highlighted some of the great things Marriott hotels, one of the world’s top employers in the hospitality industry, is doing to retain their employees. At the pandemic's peak, CEOs and top executives accepted a pay cut to help keep their employees despite having to furlough thousands of employees worldwide. They also ensure that employees' well-being is important and valued. In addition, their employees felt like they were a part of the organization’s purpose.
Your workplace could increase employee retention if you allow employees to openly discuss how they feel in the workplace and suggest ways how you could meet their needs to improve performance. Furthermore, providing competitive benefits packages, continuous training programs to upskill or reskill employees, and flexible work schedules could decrease employee turnover and increase their work-life balance.
We encourage knowledge sharing on our platform and would love to hear from you. What practices are you implementing to promote employee retention and loyalty in this challenging labor market? Please share your responses in the comment section below.
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