In WSA’s recent learning session, led by Dr. Cameron Klein, we explored the latest trends shaping the employee experience in the hospitality industry. The session highlighted critical insights into how external forces, like the lingering effects of COVID-19, rising unionization trends, and the global war for talent, are redefining engagement and retention strategies. Let’s dive deeper into these key themes to uncover what they mean for your business and how you can leverage these insights to build a stronger, more resilient workforce.
The Lasting Impact of COVID-19: A Double-Edged Sword
The hospitality industry was hit harder by the pandemic than any other sector. Entire cruise lines shut down, hotels reduced operations, and many employees were let go. Yet, in the face of adversity, a unique shift occurred: engagement scores spiked at the height of the pandemic as employees who remained felt grateful to be employed. Leaders became experts overnight in safety protocols, prioritizing team members’ well-being and navigating an entirely new landscape.
Today, as the industry makes a strong comeback, the scale of this rebound has been nothing short of remarkable. Cruise lines have seen a surge in bookings, often selling out months in advance, and resorts are experiencing record-breaking occupancy rates. However, this rapid resurgence brings its own set of challenges. With demand soaring, operational pressures are at an all-time high, making it even harder for companies to maintain the level of employee support observed when business was halted due to the pandemic. Leaders are now tasked with balancing the need for heightened service expectations, increased workloads, and employee safety protocols—all while keeping the workforce engaged and motivated.
Maintaining a commitment to employee safety, transparent communication, and ongoing support is more crucial—and more complex—now than it was even during the pandemic. The companies that continue to prioritize these aspects amidst this heightened demand will retain top talent, build resilient teams, and create work environments that stand out in this fiercely competitive market.
Rising Unionization: A Call for Proactive Engagement
Union activity in the hospitality sector continues to increase, driven by employee concerns over pay, benefits, and working conditions. Recent collective bargaining successes and union-negotiated wage increases in 2023 provide a glimpse into the growing momentum of unionization efforts nationwide, signaling a broader push for improved working conditions across the industry. For employers, these movements underscore the importance of understanding and addressing the root causes of employee dissatisfaction to create a more positive and resilient workplace.
Drawing from decades of research, WSA uses an Employee Relations Index to help organizations assess critical areas such as pay, fair treatment, safety, and trust in leadership. This data-driven approach allows businesses to anticipate areas of concern and proactively address them, fostering a positive work environment that reduces the likelihood of unionization. The aim is not to counter unions but to create conditions where employees feel their needs are met directly within the organization.
The Global War for Talent: Building an Exceptional Employee Experience
The hospitality industry’s rapid growth—especially in sectors like cruise lines and casino resorts—has intensified the competition for skilled workers. Turnover costs are high, averaging around $36,000 per employee, with even higher costs for retaining top talent. The challenge is not just finding the right people but keeping them engaged and committed long-term.
WSA’s data reveals that while overall engagement in the hospitality sector matches the cross-industry benchmark at 73%, intent to stay is significantly lower at 57%. This discrepancy highlights the need for targeted engagement strategies. A key differentiator in hospitality is the strength of supervisor relationships, particularly in environments like cruise lines, where employees work long contracts away from home. Organizations that invest in developing strong, empathetic leadership will be better positioned to retain their best talent, even as the industry continues to expand globally.
Linking Engagement to Business Success: Data that Drives Decisions
Quantifying engagement’s impact on business performance is essential for making a compelling case for continued investment in employee experience initiatives. According to WSA’s proprietary database, hospitality organizations with higher engagement scores consistently outperform their peers on key business outcomes such as guest satisfaction and revenue.
Engaged employees are significantly more likely to go above and beyond, contributing directly to higher business performance. Linking your engagement data to business metrics, such as RevPAR (Revenue Per Available Room) or guest satisfaction scores, can provide actionable insights that drive meaningful improvements. One cruise line, for instance, discovered that a 10% increase in engagement correlated with a 7% boost in guest satisfaction scores—a clear indication that investing in employee experience pays off.
Turning Insights into Action
The hospitality industry faces unique challenges, but within these challenges lie opportunities. By understanding the current landscape, proactively addressing employee concerns, and leveraging data to drive decisions, organizations can create a work environment that not only attracts but also retains top talent.
These insights call on hospitality leaders to build workplaces where employees feel valued, supported, and engaged. Embracing these strategies will help ensure that your business remains competitive, your employees stay committed, and your guests continue to have exceptional experiences.
Explore the entire WSA 2024 Monthly Learning Session schedule here
