To 2022 and beyond: Master Innholders' predictions for the year to come
Where will the UK’s hotel sector be headed this year and into next? What are some of the challenges it can expect to face and where does it expect growth to come from in 2022 and beyond? Master Innholders provide their outlook for the year ahead.
After posing these questions to a selected number of Master Innholders it will come as little surprise that recruitment and retention of hotel staff is regarded as the most challenging issue and a factor predicted to have a profound impact on all areas of the business this year.
“Hotels will need to continue to manage their occupancy levels based on the staffing levels they have available to them as the reputational damage of trying to overstretch may hurt them more than leaving money on the table,” warns David Connell, general manager, South Lodge Hotel.
“This will inevitably force room rates up as the volume of demand versus a reduced room stock will drive the market.”
Sally Beck, general manager, The Royal Lancaster London and founder of the Hoteliers’ Charter agrees, but believes this year will be the reckoning the industry needs to finally put suggested solutions into practice.
“This year will be busier, and we don’t have enough staff to cope with that so we have to address the issues now to avoid burning them out,” she says.
“We need to reset and take the opportunity of this reckoning and resetting of expectations to ensure we are seen as the best industry to work in.”
Connell agrees: “The staffing crisis may be extremely frustrating, but if we are truly honest with ourselves the freedom of movement of people from across the EU did compress wages, and this contributed to keeping prices low,” he explains.
“What the pandemic has forced us to do is to look at wages and increase them at a significant rate as we fight against each other to poach team members in order to service that extra bedroom, or another table in the restaurant.
“Personally, I see this as a positive as we should find ways to paying higher wages and helping our teams to climb the social economic ladder, so I welcome the pressure on increasing wages, improving working conditions and work/life balance.”
Wage rises coupled with increasing costs elsewhere will inevitably lead to hotels raising their prices, predicts Serena von der Heyde, partner, Georgian House. This, she suspects will mean greater expectations from guests.
Nevertheless, there is optimism. While some Brits will be itching to holiday abroad, neither Connell nor von der Heyde believe we’ve seen the back of the staycation trend.
“Whilst we think there will be mass migration to International holidays next year, I personally believe there are huge swathes of the population who will holiday in the UK again,” says Connell, highlighting restrictions and a weaker vaccine programme in other parts of the world as part of the reason keeping UK nationals at home for their holidays.
His beliefs are echoed by Jonathan Raggett, managing director, Red Carnation Hotels: “I am optimistic about the about the return of international business, particularly from the leisure market and increased occupancies will drive business to restaurants and bars.”
Sally Beck FIH MI, general manager of The Royal Lancaster London:
“This next year will continue to be a reckoning for the industry, especially when it comes to retention and recruitment.
“In the past we have had the luxury of an abundance of casual staff that has allowed us, as employers, to be casual with our work-life balance and the care of our teams.
“The current employee crisis has highlighted the need for employers to do more and think more about work-life balance and the whole career of our employees, about mentoring, coaching and training and development.
“The future of our industry is in our schools, colleges and universities which is why we must improve our work experience schemes, internships and graduate programmes and show that the hotel industry is progressive and exciting as well as best in class within the hospitality industry.
“We’ll realise that it’s not all about money, it’s about having the right culture in the business. That is what will attract and retain the best talent.”
Jonathan Raggett FIH MI, managing director, Red Carnation Hotels:
“I am optimistic about the return of international business, particularly from the leisure market and increased occupancies will drive business to restaurants and bars. Escalating costs, the importance of staff retention and the search for new talent are likely to remain challenges throughout 2022.”
Serena von der Heyde MI, partner, Georgian House:
“We will continue to see costs rise, particularly wage costs and utilities. It means that prices are likely to go up and as a result guests will expect higher service levels. It means that businesses will look to reduce admin costs, through third party or technical solutions.
“The staycation trend is likely to continue over the coming year, to a lesser extent than the year just passed. The move to support local businesses is likely to become more entrenched with hotels buying local and promoting local products and services.
“Sustainability is becoming a factor for our visitors in their decision making, and this is likely to become more important, from guests reducing the number of flights they take each year, to choosing their hotels influenced by their sustainability credentials.”
David Connell, FIH MI, general manager, South Lodge:
“Business growth is going to be restricted by the labour shortages with over 1.1million job vacancies currently, and 134,000 of them in the hospitality sector, second only to the health sector. Until this situation changes, it will be difficult to get back to pre-pandemic occupancy levels, which will in turn restrict growth and investment.
“There is no silver bullet that is going to resolve the staffing crisis; it will take decades to change the mind-set of teachers and parents for them to say to their students and children that they should consider a career in hotels.
“Hotels will need to continue to manage their occupancy levels based on the staffing levels they have available to them as the reputational damage of trying to over stretch may hurt them more than leaving money on the table. This will inevitably force room rates up as the volume of demand versus a reduced room stock will drive the market.”