It's amazing how big of a difference just a few months can make. One of the most interesting things — to me at least — in the early days of the hotel industry recovery is how quickly the tone and tenure has shifted from extreme uncertainty for the outlook of the hotel industry to a more widely held optimistic view for how the rebound is shaping up.
Now I'll acknowledge right off the bat that what I'm referring to is either forward-looking projections for the hotel industry or the demand and revenue performance figures in pockets of the industry. In many very real ways, hoteliers are still coping with one of the worst periods in the history of the industry.
But I wonder just how much the current attitude of forward-looking optimism needs to be tempered. I hear a lot in my day-to-day reporting about how all signs point to people dying to get back out and travel. There's a huge amount of pent-up demand, the thinking goes, and as those floodgates open, the hotel industry will just have to make sure it's properly poised to service that demand.
There's obviously truth to that, but it's also way oversimplifying perhaps the most complex and — dare I say — unprecedented eras ever for demand forecasting.
Here's an example of what I mean: The broadly held belief around the industry is people are eager for a return to normal in their day-to-day lives, and by extension, they are eager for a return to travel, particularly leisure travel. At the same time, there are reports across various industries that went to primarily work-from-home models that businesses are seeing significant pushback from employees when they're told to return to their offices, to the point that many are seeking new employment that will allow them to continue working remotely. That explicitly tells us there is a significant number of people who very much aren't eager to return to normal and in fact are looking to live a bit more isolated than they would have been in the past. What's the long-term demand implication for that?
Another point: Even in the most optimistic reading of the current circumstances, a massive wave of demand is about to come crashing down on the most understaffed hotel industry in modern history. The enormity of this problem can not be understated, and lots of hoteliers are seemingly in a holding pattern hoping that scaled-back unemployment benefits will tilt the dynamics of the labor pool in their favor. For the time being, the hotel employees currently on the front lines are only growing more overtaxed and burnt out. As my colleague Dana Miller wrote in a recent piece detailing the current, varied pain points hotel operators are facing, "Many companies are asking a lot out of managers and supervisors, which is leading to exhaustion and burnout."
The people who are actively keeping this industry afloat right now aren't just burning the candle at both ends. They've dipped the candle in kerosene and thrown it into a dumpster fire. That is not a problem that will magically go away after Labor Day when each hotel can add another 1.5 FTEs.
At this point, I'd totally understand if you just think I'm a massive Debbie Downer, and obviously these are all issues everyone is aware of. But it's just a reminder to temper your optimism for the future — at least until the industry can really put out some of the massive fires still raging.
Let me know what you think. You can reach me at smccracken@hotelnewsnow.com or @HNN_Sean.
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