With travel demand accelerating rapidly, the hospitality industry is experiencing a new challenge: labor shortages resulting in sharply rising labor cost, which consumes as much as 60%-80% of RevPAR (CBRE). In the U.S. alone, hotels need to hire 600,000 more employees by summer to be able to meet demand (BIS.gov). Right now there are 171,800 open positions on LinkedIn for hospitality jobs in the U.S.

Wages in hospitality operations - frontline position such as housekeeping, front desk, wait staff, line cooks, etc. - are up more than 20% since April 2020 (Hotel Effectiveness). Hotels and restaurants alike are offering sign-up bonuses, higher wages and even cash payments to candidates just to come for an interview. In the same time productivity is down due to influx of inexperienced staff, since many of the experienced hospitality professionals left the industry due to furloughs and layoffs during the pandemic.

The question is, how can the hospitality industry solve the current labor shortages and unsustainable labor cost through technology innovations, automation, mobility, robotization and next gen technology applications?

I believe there is a 2 part solution here, one that cost money and one that saves money, putting them together will overall increase margin and service effectiveness. The first one is increase wages to make the hotel industry more competitive in the labor market. Obviously that will have a negative effect on the profitability of hotels. To mitigate that hotels should look to automate many of the cumbersome labor tasks, throw out things such as the housekeeping radio and clipboard as well as automate many administrative tasks at the front desk, such as the administrative part of the check in process. Guests really are happy to self check in, and I don't think anybody selects a hotel only for the "Check In Experience". Replace the radio and clipboard with a tablet or let staff use their own device to communicate room tasks etc. Simply things that reduce manual labor. Hotels can then do more with less, and pay the fewer people they need a higher salary. 

Helping to pay to convert some of the manual processes could for example be a digital upsell or pricing solution, that generates immediate ROI, removes immediately the manual upsell tasks and provides cash to invest in more technology solutions. Investing in tech solutions is also a lot easier today since most offerings have a monthly SaaS lowering the risk and initial investment. 

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