The hospitality industry has an extremely bright outlook in the US and beyond. The Bureau of Labor Statistics projects the addition of hundreds of thousands of job openings over the next decade as this sector continues to expand. Worldwide, the hospitality and leisure sector contributes approximately 10% of global GDP and the rise of numerous emerging markets herald continued growth for years to come. All of this combines to make this industry a very sensible career choice. However, there are a few trends to keep an eye on. Here are six that could have a major impact over the coming decade.
1. Affordable Care Act affects how employers staff
To avoid paying health insurance, some hotel and restaurant owners have decided to hire more part-time workers rather than offering health insurance benefits to full-time employees. Furthermore, this legislation has increased emphasis on tracking hours for compliance purposes, which puts additional administrative costs on businesses.
2. Approaching baby boomer exodus
Approximately 9% of the hospitality workforce is approaching retirement age. This will open up a number of leadership roles and create around one million jobs that will need to be filled in the near future. As baby boomers are replaced by millennials, companies will need to adjust their management approaches to empower these workers and keep them engaged. Retaining talented staff members long term will require investments in training and proper incentives to provide a sense of ownership and reward top performers for their contributions.
3. Changes in recruitment tactics
The employment market in general is evolving at a rapid pace, and employers in the hospitality industry are adopting new strategies to attract qualified job seekers. The use of social media sites like Facebook and LinkedIn to vet and reach out to candidates is commonplace and more establishments are optimizing their career sites for professionals who are on the go and performing job searches almost exclusively on their smartphones. Referral programs are also gaining in popularity, as businesses leverage their existing base of employees to recruit new team members.
4. Raising the minimum wage to $15 could prove to be a blessing and a curse
The campaign to increase the minimum wage – as well as a separate movement to eliminate tipping in restaurants – could move closer to becoming a reality over the coming months and years. Although the prospect of bigger paychecks is appealing, a change in pay rates that drastic will pose considerable challenges to many smaller establishments and threaten expansion plans for burgeoning franchises.
5. Significant growth expected despite sharing economy’s impact
Even though sites like Airbnb offer travelers additional options for where to stay, the hotel segment anticipates demand to outpace supply. In fact, according to STR and Tourism Economics’ most recent forecast the US hotel industry is predicted to generate a 5%–10% surge in revenue per available room (RevPAR), with a handful of areas (Denver, CO; Phoenix, AZ; and Tampa/St. Petersburg, FL) expected to see RevPAR improve by as much as 15%.
6. Global expansion and emerging market
By 2022, the hospitality industry is projected to support 328 million jobs around the world. Approximately one in every ten jobs will be in this sector of the workforce and the job market in the US is supposed to jump by a whopping 49% compared to 2013. Areas with the most potential for growth include Asia and Africa, where business is expected to increase by 6%–7%. However, it’s important to note that the worldwide tourism market is volatile and subject to rather quick changes due to concerns about terrorism or natural disasters.