How to ‘ACE’ hospitality recruitment

Learn the five key trends affecting hiring in the hospitality sector and three steps employers can take to attract top talent.

Thanks to the lifting of travel restrictions in many regions, hotels are filling up again. However, instead of heaving a sigh of relief that the worst of the pandemic is over, hotel executives find themselves with a new problem on their hands: a lack of personnel.

Up to 70 percent of all hospitality workers in the United States 1 and the United Kingdom 2 were furloughed or laid off during the pandemic, and many employers are struggling to get them to return to work. Like their counterparts in other industries, hospitality employees have used the time off to reassess their priorities, and many have found new jobs that offer more flexibility.

Accustomed to this new way of working, many are reluctant to go back to their old positions, especially if they held roles waiting tables, cleaning rooms, and checking in guests. Such roles make up a significant portion of the hospitality and travel workforce in many markets, such as in the United Kingdom, where they account for 45 percent 3 of all jobs in the industry. While automation may reduce the workforce requirements for many of these functions in the future, the current labor crunch is worsening as demand for hospitality services in the immediate term spikes.

Even those who kept their jobs are likely to seek better career prospects elsewhere as more employment opportunities open up: around 40 percent of respondents in a McKinsey survey said that they are thinking about leaving their positions in the next three to six months—and many are even willing to quit without having another job lined up.

What’s changed and what can employers do to recruit—and retain—talented employees?

In this article, we delve into the five key talent acquisition trends that employers should be aware of. We also offer a simple approach for how they might “ACE” talent attraction: analyze talent suitability with digital tools; clearly define and communicate job requirements and career paths; and empower the HR department with the skills and tools they need to find and keep talented candidates.

Five hiring trends all hospitality employers should know

The pandemic has altered the hiring landscape in nearly every industry, including hospitality. Employers who equip themselves with a deep understanding of these five shifts in talent acquisition will be better able to adapt their hiring processes to staff their workforce with the talent their companies need to thrive into the future, as well as to recoup the losses incurred during the pandemic.

1. Digitization is radically changing hospitality roles

Like many other industries, hospitality is being transformed by digital and automation technologies. As such, many companies are rethinking their business models and workforce composition with an eye at simultaneously lowering costs and improving customer experience. In hotels, more guests are checking themselves in at self-help kiosks, and autonomous drones are delivering amenities directly to rooms, alleviating the labor shortage for some of the more labor-intensive functions.

As automation takes over more tasks currently performed by humans, new job roles will be created, especially to design and manage emerging technologies and digital solutions. It is estimated that 65 percent of primary-school students in 2030 will perform jobs that don’t yet exist. 4 As hotels increasingly base decision making on customers’ booking and behavioral patterns, AI skills will grow in importance, and more data analyst positions will be created.

Hotel brands and other hospitality-focused companies have been rolling out customer-facing mobile apps, as they have found online digital channels to be especially effective at direct customer engagement. As such, more user experience (UX) designers will be needed to create attractive and intuitive customer journeys on these digital platforms and to continually optimize their design and functionality based on data analyses of customer engagement. Online marketing managers will also be needed to conceptualize and launch compelling campaigns and brand stories across mobile and other emerging platforms to entice potential customers.

To support all these shifts, software engineers will be needed to design and implement new AI solutions on the back end, as well as to optimize booking platforms on the front end and embed software for Internet of Things (IoT) applications.

2. Employees are expecting more flexibility

The pandemic has debunked, to a large extent, the idea that work needs to be done exclusively in an office. Videoconferencing and cloud-based digital tools have enabled remote work without much loss in productivity, if any. And while many people around the world have begun returning to their workplaces, they have grown accustomed to the increased flexibility to manage work and personal commitments—a level of autonomy they are reluctant to relinquish. This has led many companies to implement numerous hybrid work models.

Job searches for remote work have nearly quintupled from June 2019 to June 2021. And while five years ago about a fifth of job postings offered the option to work remotely, nearly 80 percent of postings do today (exhibit). As jobs have become increasingly location agnostic, former hospitality workers have shown an unwillingness to return to jobs that require them to be tethered to reception desks, for example. Furthermore, candidates applying for digital roles in the hospitality sector expect the same flexibility offered in other industries.

Flexible work arrangements have become the norm since the start of  the pandemic.
We strive to provide individuals with disabilities equal access to our website. If you would like information about this content we will be happy to work with you. Please email us at: McKinsey_Website_Accessibility@mckinsey.com

Based in Germany, Koncept Hotel is an example of a company that has radically embraced the idea of remote work. Some of the hotel chain’s properties are almost entirely without staff, as everyone apart from the housekeeping team works remotely. A cloud-based automation system takes care of everything, from reservations and check-ins to payments and night audits.

Many roles in hospitality could be offered with remote-working options, including social-media managers, event planning consultants, accountants, marketing and PR executives, and customer support associates. Even a concierge can go virtual with the right technology support system in place.

But what about roles that have to be performed in person, such as housekeeping or waitstaff? To address this issue, employers may need to consider redesigning what a career in hospitality looks like. For example, if employees have a diverse portfolio of roles, they may be able to enjoy more flexibility in terms of work hours and location, along with a number of other benefits.

3. Hospitality careers are becoming more multifaceted

People who currently work in the hospitality industry often wear multiple hats out of necessity. Staffing shortages are straining the smooth running of daily operations, and guest-facing employees frequently have to perform different functions to keep service standards high. For example, many hotels equip receptionists with mobile tablets so they can double as concierges. And as more burned-out employees leave the hospitality workforce, the labor crunch will likely become more severe, especially for tasks that require a physical presence.

However, some hotels are taking this seemingly intractable challenge as an opportunity to reimagine what a career trajectory in hospitality looks like. While important, a paycheck has become only one among a number of factors candidates consider when accepting an offer. Employees seek a sense of fulfilment and meaning, and one way employers can foster personal and professional growth in hotel staff is to provide opportunities for them to expand their skill set.

In-person roles can become more rewarding for current employees and more attractive to talented candidates. Digitization can provide employees in service jobs with more flexibility in responsibilities and career growth. Some functions, such as housekeeping and reception, may require a physical presence, but an employee with a portfolio of in-person and location-agnostic duties may not have to spend all their workdays on-site. As career paths become more multifaceted, employees may also be able to command higher wages and greater satisfaction.

Companies could identify and offer top performers training opportunities for higher-skilled functions in other departments. For example, a member of the front-desk team may enroll in a social-media training program to learn how to conceptualize, run, and track the effectiveness of online campaigns. After completing the course, such employees could work with the hotel’s marketing department, contributing to digital campaigns, and, as such, work from home two days a week. Since front-desk employees have firsthand interactions with many guests, they could offer invaluable qualitative insights to the campaigns they work on, while at the same time deriving professional fulfillment from being involved in an interesting project, greater flexibility to balance their personal and professional commitments, as well as a higher salary.

Naturally, empowering staff to take on multiple roles requires an investment from hotel managers and executives. And as more employees work across functions, collaboration among different departments needs to be effective, and executives would have to build the right suite of digital and on-site training programs. A robust technology and communications stack could be key to reducing complexity and to opening up the instant communication channels needed for effective problem solving. Hyatt, for instance, has created a centralized digital workspace called Konverse, which includes communication channels and a task tracking system that enables daily collaboration for employees from front desk to housekeeping to engineering.

4. ESG cannot be ignored, even in hiring

Many employees take into consideration the social and environmental responsibility of a company when choosing a place to work. As customers, investors, and employees grow in their awareness of environmental, social, and corporate governance (ESG) issues, hotels are reviewing every aspect of their corporate strategy and operations, including hiring practices and roles.

Many companies are finding it helpful to have a leadership position that provides oversight and coordinates best practices on issues pertaining to their climate impact. As examples, Carnival Cruise Line has a strategic sourcing manager in charge of sustainable procurement, and TUI Cruises has an environmental manager who is in charge of ensuring that all of the company’s functions are aligned with ESG standards. On a more granular level, more hotel chefs are being tasked with sourcing more locally, organically, and sustainably, and chains such as the Shaner Hotel Group hire eco guides to educate guests about the environment and plan eco-focused activities.

As customers, investors, and employees grow in their awareness of environmental, social, and governance issues, hotels are reviewing every aspect of their corporate strategy and operations.

When hiring, employers could also be paying more attention to diversity, equity, and inclusion (DEI). A diverse and inclusive workforce contributes to greater employee satisfaction and is correlated with better economic performance. Companies could partner with external organizations and reassess their perks and benefits to foster greater inclusion. For instance, Kimpton Hotels and Restaurants works with organizations such as Trans Can Work, The Mom Project, and DirectEmployers Association in their recruitment efforts, enabling the company to benefit from a diverse talent pool of candidates. Meanwhile, Hilton, which ranks second in Fortune’s 100 Best Companies to Work For list for 2022, uses a quarterly diversity dashboard to track a company’s diversity performance based on clear metrics and targets, including the makeup of its corporate leadership. To ensure a pipeline of diverse leaders for senior management, Hilton partners with universities such as Harvard and Cornell on external development programs.

5. The bar for hygiene will remain elevated

Even though restrictions implemented during the COVID-19 pandemic are gradually being lifted, many hygiene protocols will likely endure beyond the pandemic. New roles and skills are needed to improve the coordination of hygiene-related initiatives across companies to protect the safety of both guests and employees.

For instance, some hotels have hired hygiene managers to revise sanitation protocols and oversee their implementation across the property. This requires coordinating with different subdepartments such as food and beverage, spa and wellness, and entertainment. The hygiene manager trains hotel staff on how to maintain hygiene standards and also works closely with the legal department and medical team to ensure that initiatives adhere to local laws and are grounded in science.

ACE talent acquisition

Hospitality employers may need to adapt their hiring practices in response to these five shifts. To start, we’ve come up with a broad approach that may help them ACE talent attraction and improve employee retention.

  • Analyze talent suitability with digital tools: Whittling down a pool of applicants is often done based on gut feeling and the personal experience of the recruiter, which is not only expensive but often ineffective—up to 80 percent of employee turnover is due to poor hiring decisions. Advanced data analytics can be a powerful tool to help identify appropriate candidates while reducing the subjective aspects of the screening process. An employer can define the specific talent they are looking for (analytic tools may help identify potential gaps) and work with a data analytics team to build a predictive model to identify likely characteristics of success, using it to sift through the stack of digital résumés. By implementing this approach, a fast-growing organization that struggled to retain high-performing sales talent managed to reduce first-year attrition by 23 percent and improve quality of new hires by 40 percent.
  • Clearly define and communicate job requirements and career paths: No one likes nasty surprises, so it’s best to avoid them by defining roles and their requirements early in the game. Each candidate and new employee should know how performance will be evaluated and the perks, support, and benefits they will enjoy when they join the company. While an employee’s career trajectory may change after joining a company, the candidate should be aware of the options available and the path they can expect when they receive an offer. In our experience, employers who use employee-centric design to optimize and customize a candidate’s career path within the organization, taking into account their unique attributes, skill sets, and interests, tend to be companies with the greatest impact and satisfaction rates among their staff.
  • Empower your HR department: A skilled HR team makes all the difference, but building one requires investment and training. They should be trained to wield the digital tools they have at their disposal competently to screen the most suitable candidates quickly, identify reasons why candidates fall out of the recruitment funnel, and streamline the overall hiring process so that it doesn’t drag on for more than two weeks. Beyond these technical skills, the HR team should also know how to conduct smooth interviews. According to Workplace Trends, nearly 60 percent of job seekers have experienced poor interview processes, and 72 percent of them shared those experiences with others. Even when a candidate is not the perfect fit for a specific role, they may be suitable for another role, so it’s important for those who don’t get an offer to also feel valued.

Hotels and other hospitality players have a rare opportunity to rebuild their workforces by transforming their hiring practices. Those who keep these five trends in mind and adopt the ACE approach may find the industry’s brightest talents clamoring to join and grow in their ranks, delivering superlative guest experiences for a long time to come.

Explore a career with us

Related Articles