Challenges in the Hospitality Field

There are many challenges facing the Hospitality Industry these days. There are labor cost issues which is the single highest expense for managers it consumes a large portion of managers time and effort. Although now with the new of union contact negotiations, the changes to immigrant laws, and the proposed legislation to increase minimum wage, managers in the hospitality field are on the edge with their budgets. But, a balance should be made between cost control and guest satisfaction because employees are an integral part of the lodging experience for the guests the interaction between these two has a dramatic impact on customer experience and the success in the hospitality industry. Some of the things that the industry faces is the compression of the labor force which is the traditional labor force is shrinking and results from the changing demographics. The slowing population growth rates, the aging population, and fewer persons in the working age group have all contributed to the shrinking labor supply. There are also unionization issues that are the growth between both unions and interest among employees in unions. Also its affected be the increasing health care costs along with other benefits because increases in the benefits cost are making it more expensive for employers to hire and retain employees, hospitality companies are forced to be more selective in their hiring process. Labor costs are also affected by immigration issues and temporary work visas, since the tragedy of 9/11 the US has become more strict with immigrants and who they issue work visas to and this decreased the overall workforce. In these cases the best thing is to hire low paying employees to do the job rather than someone which require a hire pay rank.

With escalating costs that are associated with litigation the hospitality sector is increasingly recognizing the disputes that arise between parties may be reasonable, fairly and economically resolved through Alternative Dispute Resolution. Arbitrators and mediators have been brought into the hospitality dispute resolution with little understanding of the dynamics or the history of the hospitality industry. The industry now has a large amount of industry experts who have been trained and certified as commercial arbitrators, and mediators who are ready to support the resolution of disputes from the simplest to the most complex. So these escalating business costs are handled professionally through these people without anyone knowing or finding out that these problems exist in their industry. The hospitality industry is concerned that operating expenses will escalate at a greater rate than that income they make for that hotel owners must monitor energy costs, higher insurance costs, labor costs and labor shortages, and brand standards. Energy costs are increasing globally in demand and the natural disasters in the Gulf States have stretched energy supplies, energy management and conservation programs and employee

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