The hospitality industry has a hiring problem.
While Americans are eager to get back to dining, traveling and in-person shopping, hospitality employers are struggling to recruit enough staff to serve these enthusiastic customers.
In July, U.S. job openings rose to 10.1 million from 9.5 million in June — a fourth straight record high. But it’s not just new job creation, as quits also rose — from 3.8 million to 3.9 million, with most quits coming from the retail, restaurant and accommodation sectors.
Many say generous COVID-19 unemployment benefits have caused resignations and this hiring crunch? But why would anyone choose to work when UI pays more than a hospitality income?
The hospitality industry has long been plagued by low wages, minimal benefits, late hours and instability — compounded by high health risks and harassment that has only increased during the pandemic.
During the shutdown, hospitality workers were suddenly granted free time to pursue their passions, to seek out other jobs, and to simply rest. Many realized they were burnt out.
So, how can hospitality employers now encourage workers to return? By taking a cue from some of the 2021 Certified™ great workplaces, both in and out of hospitality.
Hiring strategies for the hospitality industry
1. Conduct two-way interviews
At Playa Hotels & Resorts, interviews are just as much about what a candidate is looking for in a job as they are about qualifications.
“We want people to stay with us for a long time,” explains Dayna Blank, senior vice-president of human resources. “We want you to know exactly what it's going to be like day-to-day because we don't want you to get here and be unhappy or not engaged.”
Dayna points out how too often, interviews are a one-way street: does the candidate have the right skills, attitude and experience? Rarely do employers, especially in the hospitality industry, stop to ask candidates what they want in a workplace.
2. Tap into word-of-mouth
When a workplace really is a great place to work, there’s no better recruitment tool than existing employees.
You could encourage staff to become brand ambassadors. Ask them to post stories about why they love working for your organization on your social media accounts, or post positive comments from your Great Place To Work Trust Index™ survey on your jobs page or in Instagram posts.
But be warned: social media is a powerful tool that can swing both ways. Honesty and authenticity are essential — anything that doesn’t ring true can and will be called out by staff or by customers.
3. Score some referrals
When Nationwide Mortgage Bankers was hit with a labour shortage due to low mortgage rates and a subsequent refinancing boom in 2020, they turned to their employees. The company offered a referral bonus that kicked in after the hire had stayed on for 90 days and again at 12 months.
“Most of our really good hires last year came from referrals,” explains Jodi Hall, president of NMB. “And that was by getting our employees to tell the story of our culture and how we are different.”
4. Trial no tipping
Eliminating tips might be a controversial idea to some, but there are many success stories about restaurants that have done away with tips. By abolishing tipping culture, restaurants can also reduce tensions between back and front of house staff and foster greater equality in the workplace.
In another scenario, restaurant owner Peter Simpson, noticed how the new no-tipping policy led to better employee retention and hiring:
“Before Simpson eliminated tipping, he had to hire two to three new people a year. He hasn’t had to fill any open spots in 2018, and hasn’t had to hire anyone in the kitchen for several years. Customer service has improved thanks to better staff relationships with customers, and Simpson doesn’t have to sink time and effort into constantly training new employees. The kitchen staff and service staff have a much better relationship as well, because they are all on the same wage scale.”
When restaurateur Danny Mayer ended tipping culture at his hospitality group, he noticed many perks to the company culture. The best career servers didn’t have to compete for the high-tipping weekend shifts anymore, so mid-week had better overall service because the spread of experienced staff was more even.
This also meant career servers got to spend more time with family and newer staff made more consistent money, since they generally got the lower tipping shifts under the old model
5. Put more focus on women
Women make up just under half (47%) of the U.S. workforce, jumping to 52% of accommodation and food services, and up to 70% in some retail sectors, according to 2020 U.S. Census figures. And yet, the U.S. remains woefully behind in accommodations for women and families.
In hospitality, with a workforce that’s often part-time and paid hourly, only 6% of workers have access to paid parental leave.
Stephanie Doliveira, vice-president of HR for Sheetz convenience stores, wont’ settle for this.
“Women have a unique challenge when they’re working full-time. Oftentimes they’re mothers and trying to balance work and life. [At Sheetz], we started with women. We started with moms, and we offer 100% pay for 12 weeks [maternity leave]. In the retail world, that’s unheard of.”
Other women-focused initiatives Sheetz has implemented include a women’s leadership program, and even domestic abuse training for managers to recognize the signs when someone might need support.
6. Be flexible with scheduling
From restaurants to retail, the hospitality industry has always been heavily shift-based. And yet, late hours and last-minute scheduling can leave workers feeling just as trapped as more traditional 9-to-5ers, especially when something urgent comes up. Sheetz is combatting this with a flexible absenteeism policy.
“It could be that you’re not feeling well, it could be your child’s not feeling well. It could be that your cousin came in from Kalamazoo unexpected and you need to spend the time with them,” says Stephanie. “You’re given a bank of attendance points, and we don’t ask the reason why you’re off. You don't have to justify it.”
7. Get personal
Best Workplaces™ know that employee engagement begins before employees are even on the payroll. At Playa, onboarding includes meetings with people from across departments, so that new hires can feel like part of the team before they even start.
And after hiring, that personalization carries through to how Playa celebrates employees.
“Rewards and recognition are different to every single person,” says Dayna Blank, SVP of human resources at Playa. “Some people like public recognition, some people like private, some people want money, some people want time off.”
8. Increase wages and benefits
Perhaps the most obvious solution for the hospitality hiring crunch is to offer wages and benefits competitive with other industries. The current U.S. federal subminimum wage for tipped workers is only $2.13 an hour.
Changing the status quote is admittedly easier said than done. The restaurant industry, for example, has slim margins combined with rising food costs, that make wage increases difficult. But as employers in other industries recognize, employees who are fairly compensated are more likely to stay.
“When your team’s not stressed about money, they’re happier, they’re more successful, they’re more productive,” says Chance Gurr, chief operations officer at software company You Need a Budget. “As your team members improve their financial situation, they miss fewer days at work, they produce more, they smile more, they don’t jump to work at your next competitor employer for a dollar more an hour.”
9. Track employee sentiment through surveys
Regular employee engagement surveys provide useful data so that employers can monitor whether they’re at risk of a mass exit by staff.
Says Dayna, “I don't expect to ever be surprised by anyone’s resignation or for a manager to be surprised because that’s how well you should know your people.”
“Part of the retention strategy is this continuous feedback along with an open-door policy. It's just all the time.”
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