The Hospitality Labor Shortage is Affecting Hotel Construction

Like the tightening of a screw to a bolt, the construction labor market is feeling the pressure. Thanks to a tight labor market—and a whole segment of the population still thinking that college is the only way to make a good livinga lot of buildings are behind schedule.

Plumbers, electricians, and carpenters are just a few of the roles that need qualified tradesmen. Otherwise, hotels continue to sit, waiting for their turn to be completed or renovated. The travel industry is booming; we’ve seen hotel construction rise 3.9%, but according to the U.S. Bureau of Labor Statistics, there are almost 400K unfilled construction jobs .

Because there aren’t enough people to do the jobs, openings are delayed, and there’s a significant ripple effect. 

The Hyatt brand of hotels had multibillion-dollar expansion plans for 2020 and beyond, but the reality of the current market has them expecting delays and ballooning costs. The Associated General Contractors of America said that 80% of construction firms struggle with filling positions. California, Florida, New York, New England, and Chicago are the markets feeling the biggest squeeze. (Down here in Texas, we’re also feeling it big time, too.)

 

Technology is the hotel industry’s saving grace

One of the largest areas of improvement needs to be finding and educating younger workers. Otherwise, the industry risks an even longer backlog. There are programs for kids straight out of high school or early in college, and for the most part, they’re working. Otherwise, hotels risk an even longer backlog.

But not all hope is lost; the U.S. Bureau of Labor Statistics believes construction workers will come back “much faster than average” by 2028, growing 11 percent. It’s just going to take some time. After the recession in 2008, a lot of buildings weren’t going up, and across the board, jobs stalled out, leaving many trades workers scrambling for new opportunities. Because of that loss of employment, there are still ripples being felt today. In some of the affected areas, where they can’t find enough workers, a few companies are importing workers and housing them.

To combat the worker shortage, companies have gotten creative. From on-demand staffing for day labor help to 3D printing, drones, robots, and every other way to get the job done, contractors are utilizing new tech to meet deadlines. To combat the shortage, a few options for prefabricated, modular sections have popped up. The budget hotel chain, CitizenM, took an IKEA-based approach by building all of their hotels modularly. For workers with little experience, working on prefab sites is a fantastic way to get hands-on experience, which could parley into further construction jobs. This is also a perfect fit for on-demand workers, too, considering the level of skill for general labor isn’t that of a journeyman. 

 

There needs to be an evolution 

Across the board, the hotel industry is suffering. The consequences of the labor shortage are rippling throughout the hospitality industry. It’s not just the construction sector, but the actual hotels themselves. When new hotels can’t go up, that means the existing hotels can’t keep up with demand. Right now, there’s a boom in the hotel industry, and since people are traveling more than ever, that means bigger backlogs and longer wait times. If a hotel can’t keep up, people will talk about it. The shortcomings will end up on review sites like Yelp or TripAdvisor. If that happens, the snowball only gets bigger. Some hotels are using temporary workers to help offset the boom, which is helping them survive the worker shortage. 

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