HOTELIER MAGAZINE, March/April 2002

A Fine Balance

With the effects of September 11 still being felt by Canada's hotel industry, hoteliers are faced with the problems of staff cutbacks and employee retention

The headlines screamed the news loud and clear: "Hotel group says it cut 500 jobs since the U.S. terror attacks," read the Associated Press. "Wyndham International Inc.: Hotel Chain Slashes Jobs In Wake of Terror Attack," reported the Wall Street Journal. "Hotel Industry Hit by Massive Job Cuts, Layoffs: An estimated one million are out of work or have had hours cut in 'catastrophic' blow. Owners, unions to lobby Congress for federal relief," mourned the Los Angeles Times. With the combination of these casualties, the effects of an already dwindling economy and the collapse of Canada 3000, Canadian hoteliers began bracing themselves for the worst.
While the financial effects of last September's events were felt through- out the hotel industry, they also created a turbulent job market for the thousands of staff at Canadian hotels. As travel slowed down, occupancy rates started to diminish coast to coast, dramatically shifting the power in the job market. Almost a year ago it was an employee's market, with numerous jobs available and an abundant demand for good employees. Now, with occupancy rates dropping, positions are being cut, hours whittled back and budgets shifted, leaving those who still have jobs thankful, stressed and overworked.
But just how badly did the collective events of September 11 affect employment and employees in Canada's hotels? Probably better than you think. "How are hotels coping? Are they rebudgeting? Are they cutting back hours? Are they laying off people?" asks Norman Wolfson, president of Toronto-based hospitality recruitment firm Lecours Wolfson. "The answer is all of the above."
If hotels are laying off staff, they're certainly not shouting it from the rooftops. In fact, some Canadian hotel managers are reporting that they didn't suffer as much economically as other major tourist cities such as New York and London, England. At Toronto's Strathcona Hotel, changes primarily resulted in trimming hours and rebudgeting. "Our September 2001 revenues were drastically different from September 2000," says general manager Dermot McKeown. "And we had three months of reduced revenues and reduced occupancies over the previous year, and reduced hours were the result of that."
At Halifax's Westin Nova Scotian, general manager Guido Kerpel also didn't have to lay off employees, although there was some natural attrition of employees, In fact, the hotel added one position -concierge. "If there - are fewer guests, service becomes even more important, so we added extra service to the hotel," says Kerpel. Michael Haywood, professor at the University's of Guelph's Hotel Administration program, believes cutting strategies seemed to differ according to a hotel's organizational philosophy. "If their HR departments are well managed, they tended not to slash positions," he says. "I think hours were cut back rather than just laying people off. But then again, some had no option but to layoff."
Not surprisingly, the changes have affected employees at all levels, from front-line staff to management. Wolfson says his company is receiving numerous calls from employees searching for new positions because in their current jobs they're overworked, under-supported and looking over their shoulders for what's yet to come.
-For-some of the more seasoned hotel employees, particularly those who survived the early 1990s, there's a feeling of having been through this before. Managers also say there's an empathetic feeling during this economic decline, since there is a tangible event to directly tie the drop in business to. "I think we're a little more sensitive to each other," says McKeown. "On a personal level it's just made all of us question our values, and it's the same thing with the hotel. If anything, we're probably closer as a group, despite the fact that hours were cut back and people are suffering with their paycheques."
Employees have also become more flexible and open to switching shifts and other changes, either out of fear or empathy. "We've been fortunate to have employees with great flexibility in work assignments," says Wolf Hengst, the Toronto-based president of Worldwide Hotel Operations for Four Seasons Hotels & Resorts. And If the strain of doing more than their share is present. managers say that employees are quick to cover shifts and jobs needing completion.
For operators, the change in the economy has meant there is now a larger pick of the crop for new hirings, if there are any. That's been good news for properties such as the 18-month-old Hyatt Regency Calgary. Since it's still in the growth stage, general manager Steve McNally says the hotel has remained largely unaffected by September 11 in terms of employees, and hasn't had any layoffs or wage freezes for its 300 staff. "We've certainly seen a lot more applicants coming through the door and we have not stopped hiring," he says. "I guess from that standpoint we're a bit lucky."
Yet underlying this optimism is the knowledge that a slowdown is coming. After all, it's a wave some have ridden not so long ago. "These are temporary measures," says Wolf son. "When we emerge from difficult economic times we run our businesses tighter, and then we expand and get comfortable. And then the economy goes into a downturn and we rethink everything again."
One permanent change seems to be in the way companies communicate with their employees, with many realizing that what their employees need most from them is information about their situation. The Westin Nova Scotian, for example, held regular meetings every other day last fall to keep workers aware of the situation. Kerpel also made sure to focus on appreciation for both front-line employees and management. "They were obviously closer to the numbers and could really see the impact that 9/11 and/or a recession has on the business." That meant little extras such as company sweatshirts, a Christmas lunch and management parties. As well as continuing to work on boosting staff morale, Wolf son suggests hoteliers look towards the future as a way to encourage key employees. "You've got to sit down with the smart ones and say 'Look, here's a five-year plan for the company and we see you fitting in and doing this with us," he says. "That's how you motivate your employees in tough times."
While managers work on motivating their employees, most are not concerned that this ultra-tight job market has deterred future job-seekers, despite the fact that Haywood says he hears students joking about the possibility of turning to graduate school rather than trying to break into the industry. "I have no concerns for the long term," adds Hengst. "This is temporary. This is always going to be an exciting business to be in and one where you can actually make a decent career starting at the bottom." Kerpel agrees: "You either have it in your blood or you don't. So 1 think those people who have a service disposition will still be attracted to the hospitality business in the future." .