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Will the labor problem revolve in 2022?

The Bureau of Labor Statistics (2022a, 2022b) released the latest labor market statistics. The unemployment rate further declined to 3.9% in December 2021. The number of unemployed persons continued to decrease by 483,000 to 6.3 million. The leisure and hospitality industry added 2.6 million jobs in 2021, but employment was still down by 1.2 million, or -7.2%, since February 2020. 

 

Highlights from the accommodation and foodservices sector

 

(October 2021 vs. November 2021)

  • Job openings: 1571 vs. 1310 thousand, or -261,000 (largest decrease among all sectors)
  • Hires: 1075 vs. 1079 thousand, or +4,000.
  • Separations (layoffs, discharges, retirement, death, disability, and transfer to other locations of the same firm): 918 vs. 1048 thousand, or +130,000 (largest increase among all sectors)
  • Quitting: 761 vs. 920 thousand, or +159,000, (largest increase among all sectors)

 

Is the labor shortage over already? 

 

Just because the industry has fewer job openings in November, it does not mean the labor shortage is over already. It is plausible that businesses are adopting new procedures that require less manpower, such as utilizing more automatic services or having fewer employees do the work.

 

What is going on in the industry? 

 

Another report showed that one in 16 leisure and hospitality workers in the U.S., or 6.4% of its workforce, quit in November alone (Kaplan & Hoff, 2022). Some analysts believe that the low unemployment rate and competition with other sectors make hotels and restaurants less appealing to job seekers.  

 

In fact, the average hourly wage in the leisure and hospitality industry was at the bottom, at $19.20, or about two-fifths of the highest earners (utilities at $45.15 and information at $44.54). Nevertheless, $19.20 was already a substantial increase from the pre-pandemic level, close to a 14% jump from $16.90. 

 

Labor shortage will at least stay for a few more years

 

Traditionally, the industry also employs a large number of foreign workers with temporary non-immigrant visas and hospitality students. During the pandemic, however, international travel and quarantine mandates and low enrolments in universities across the nation do not help ease the situation. Even if the enrolment in hospitality programs resume to the pre-pandemic level soon, it will take a few years before they can graduate and be ready to enter the workforce. For now, the industry needs to make hospitality and tourism jobs more attractive to job seekers, current employees, and students. What are your suggestions?


Note: This viewpoint was first published in The Hospitality News Magazine in February 2022. 

Comments

  1. The information in the post you posted here is useful because it contains some of the best information available. Thanks for sharing it. Keep up the good work. pls visit our website Hospitality Management Software.

    ReplyDelete
  2. Daniel Maciel HRT 3500 Section 2April 19, 2022 at 12:51 PM

    This article really piqued my interest because I recently was hired during the time of the labor shortage. At my job I saw firsthand the impact of the labor shortage. There were many new hires, so it created a lack of experience in the restaurant. In turn it created longer ticket times, disorganization, and more time investing in teaching. However, it never felt that it was understaffed in fact there were more new people coming in the longer I have stayed. I feel that there isn’t a lack of people not wanting to go back but rather the right incentives are needed to bring people in. This article did a great job at detailing what the industry is going through abroad and how the higher wages helps!

    ReplyDelete
  3. Lex Fuller HRT 3500 Section #1April 25, 2022 at 12:25 PM

    This post did a great job highlighting the issues happening currently relating to the labor shortage of 2022. I thought this issue was very relatable to me because I worked at a hotel pre-pandemic and during the pandemic. At the Hilton property where I worked, the number of employees in all departments went from 148 people, down to 28 in total during the pandemic. While this was a limited-service hotel, seeing many of my fellow employees leave and not return was shocking. One suggestion I would give to hospitality and tourism jobs is make it worth it to employees. We were all working more and not earning enough for the work we put in. I think increasing pay, even if it’s a very small amount, or adding more benefits, would ultimately make employees, that do stick around, happier and less likely to leave.

    ReplyDelete
  4. Alexys Zamora HRT 3500 Section #2April 25, 2022 at 6:20 PM

    I really enjoyed reading this article because I worked the majority of the labor shortage. It was a wild thing to experience and one thing I would've liked to have suggested to the hospitality and tourism industry is to be more creative in advertising job opening. Many people did not go out of their way to look for jobs because they were receiving benefits from unemployment. So, one way jobs could have advertised their business more could have been through social media, which tends to reach a far spread of people very quickly.

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