America’s hotels are still creating jobs, but will that be enough for the summer rush?

Change grip

Steady job growth is a good thing, of course, but hotels still face a huge labor shortage. The summer holiday season is right around the corner and it could spell chaos if hotels don’t deal with the continuing shortage.

Mary Ann Ha

U.S. hotels added 25,000 jobs in March, a healthy gain, but that comes amid continued labor shortages and high expectations for an increase in summer travel.

The US Bureau of Labor Statistics’ monthly jobs report released on Friday showed jobs in the recreation and hospitality sector accounted for 112,000 of the 431,000 total jobs gained in March. The sector’s unemployment rate fell from 6.6 to 5.9%, still well above the national average of 3.6% in March.

While the numbers in the March report have undeniably moved in the positive direction, hotels still have a very long way to go. The summer season is approaching and agencies are seeing pent-up demand for travel and accommodation – with a lack of jobs to meet it.

“The bad news is that the labor market remains extremely tight and is putting enormous upward pressure on the cost of labor for the accommodation industry in particular,” said Daniel Lesser, CEO of LW Hospitality Advisors. “It’s a challenge, there’s no doubt about it, and it will remain a challenge for the foreseeable future.”

A survey carried out earlier this year by Longwood’s International showed that 92% of respondents intended to travel in the next six months, with just 21% indicating concern about Covid, which is the lowest level since the pandemic. Despite rising fuel and airfare costs, US travel booking sites such as Hopper and Kayak reported increased demand for spring and summer leisure travel following the easing of Covid restrictions. Vrbo revealed that property inquiries already exceeded last summer by 15%.

Yet employment in the leisure and hospitality sector is still down 8.7% since February 2020. As the world suddenly springs into action, the hospitality industry accommodation is hard pressed with an insufficient number of workers. According to the US Travel Association, of the 1.6 million jobs yet to return to pre-pandemic levels, 1.5 million are in leisure and hospitality. In other words, the leisure and hospitality industry now accounts for 93% of all jobs in the United States that are yet to be recovered.

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