The Australasian hotel industries greatest challenge – skilled manpower

Adelaide SkyCity recently hosted the 12th AHICE (Australasian Hotel Industry Conference & Exhibition) with leading industry experts at the most prestigious hotel conference in Australasia. 

The theme for the 2021 conference was ‘The Next Decade: Planning for the Future of the Australasian Hotel Industry’ and has attracted world-class speakers.

The AHICE advisory council made up of leading hoteliers from Australia and New Zealand met to identify the industry’s challenges and opportunities. Key topics which were presented at AHICE 2021 included: Latest Trends, Market Analysis and Market Research, Technology and more.

The CEO of Tourism Accommodation Australia (TAA), Michael Johnson held a presentation covering the Association Outlook. Mr Johnson started his presentation by saying, “I have spent my working life in bustling hotels… in busy lobbies full of guests and staff and noise and movement, you can get things done sitting alone in front of a screen full of faces…but for someone like me… someone who likes to socialise, have a chat and look people in the eye… it’s just not the same”.

No, it is not the same; indeed, the pandemic has decimated the travel industry that prior to the event was experiencing unprecedented growth and the pandemic has not just decimated the business but has also left some deep gaps that are challenging to fill.

Mr Johnson emphasised the ‘unprecedented’ events that Australia has experienced in the past 18 months. The bushfire which ravaged regional Australia and damaged the tourism sector from September 2019 till March 2020, then in March, the Covid-19 pandemic happened, which brought the closure of state and international borders, state lockdowns and capacity restrictions, all these events have been unprecedented.

Mr Johnson summed it up beautifully and said, “while I risk taking all power and meaning from the word… the only way I can describe the current employment shortage crisis facing our industry today is – somewhat predictably – unprecedented”.

He touched on another issue that has been affecting the hospitality industry for a long time, the skills shortage and retention of staff.

Mr Johnson said, “anybody who has worked in a hotel in the last decade knows that getting and retaining staff has been a problem for a long time”.

However, the last year this problem has grown into something much more worrying.

The global pandemic not only distracted governments and business from tackling our staffing issues it also created a unique set of conditions that have made it worsen ten-fold.

When Mr Johnson took over the reins of TAA in March 2019, the Australian hotel industry was flourishing with a wave of a constructions and design-driven development.

Between 2017 and 2019, more than 40 new hotels entered the market, and a further 270 new hotels were on the way. More than 50,000 new rooms were planned to be added in the next two years.

The industry was worth $8 billion to the Australian economy and at the time employed more than 187,000 people directly and indirectly.

Then the coronavirus pandemic hit the world, and that changed the ball game.

The next 15 months, and certainly since last August, the hotel industry in different parts of the country endured shutdowns, lockdowns, border closures and capacity restrictions.

The international market was lost due to the closure of our borders, events and conferencing disappeared, and so did the confidence.

The industry has not only lost long term and skilled employees, but it has also lost the international students, working holidays makers and temporary skilled visa holder.

These workers were the lifeblood of the industry, and they have since left the country, unable to return or be replaced.

According to a recent nationwide survey of AHA and TAA participants, a significant 73 per cent of hotels claim their company is struggling financially due to a skills shortage.

Only in NSW, the TAA estimates a shortage of 3800 employees in hotels currently.

The shortage of skilled workers across Australia is crippling the hospitality industry still heavily impacted by COVID.

Mr Johnson, alongside AHA CEO Stephen Ferguson, has asked for regulatory changes to migration provisions to assist the industry to overcome critical labour and skills shortages caused by the pandemic.

The following recommendation for short-term support was made:

∙       Remove the cap off the international students who are here and to allow the return of international students and working holidaymakers.

∙       Allow International students working in hospitality to work more than 40hrs per fortnight.

∙       List Hospitality (including accommodation) as a critical sector for the subclass 408 Temporary Activity Visa.

∙       WHM VISA holders working in tourism to be able to work for the same employer for more than six months in rural and remote areas of Australia.

∙       Cooks and chefs to be added to the Priority Migration Skilled Occupation List

The TAA is also working to develop more interest for young people to choose the hospitality industry. Hotel advisory groups in NSW are working with TAFE to boost support for hotel recruitment as well as including school-leavers, apprentices and trainees and upskilling existing hotel employees.

There are signs of improvement in regional; areas that are leading the way to recovery, but the major gateways of Sydney and Melbourne are still suffering.

TAA pushed for the accommodation voucher program for Sydney, and we are now working with NSW Treasury to finalise procedures for a June implementation.

In closing, Mr Johnson said, “of course, the relaxation of restrictions remains a major concern… and it is impeding our outlets’ ability to maximise revenues…even if they have employees to do the work.