The leisure and hospitality sector of the United States economy continues to be under close scrutiny by the Department of Labor and the National Labor Relations Board on the issues of minimum wage and overtime regulations.
Last year it became apparent that the pressure would continue well into 2016 with more cities and states considering a $15 minimum wage. The Department of Labor is likely to issue new regulations by the middle of this year that will lead to an increase in the overtime wage requirement for “white collar” workers and a possible change in the duties test.
- Find out how hoteliers can prepare for a minimum-wage jump.
To gain a clearer understanding of the pay practices in the industry, WageWatch partnered with the American Hotel & Lodging Association to conduct a comprehensive survey of hotel management companies. A key finding of the survey was that throughout the hotel industry, department heads, GMs and senior executives at hotel management companies started their careers working in hourly entry-level jobs.
Contrary to the stories that many media sources and politicians seem to repeat, hotels offer employees tremendous opportunities for promotions and pay raises well above minimum wage. Further proof of the overall positive working environment at most hotels is that 75% of survey respondents reported that on average, hourly employees stay with the company for more than five years. Turnover is also relatively low when compared to other industries, with almost 80% of employees reporting above average job satisfaction in employee engagement surveys.
The hotel industry is growing and the employment levels as reported by the Department of Labor have hit new records for the past 20 months. Wages have been steadily increasing with more than 90% of the survey respondents reporting that incumbents earn above the minimum wage and more than 92% of their employees work full time and receive benefits.
Times are changing
While our survey results are timely and positive for our industry, times are changing.
Millennials are now viewed as the future of the travel industry with an estimated one-third of current travelers being part of Generation Y. As of last year, Gen Y became the largest demographic group, surpassing baby boomers. They are reshaping the hospitality industry in more ways than one. How well do millennials fit into in the hospitality workforce? Very well indeed.
Technology is reshaping the hospitality industry. Hotel operations and millennials are online 24/7. Real-time marketing through social media, using voice-assist software on mobile devices to book hotel rooms, air travel, and car reservations are just the beginning. Speaking with a person is not their first choice, while using a cellphone to open the guestroom door is. Millennials feel self-sufficient, love to travel and are tech-savvy. They want to be part of the team and the decision-making process. The hospitality industry is a perfect fit.
To meet the growing needs of the industry, hospitality and tourism programs offered by colleges and universities have grown rapidly in the last decade globally. Most of the leading hotel management companies offer tuition reimbursement to employees as a benefit to attract and retain employees.
But you do not need to be a college graduate to succeed in the hospitality industry.
A good friend of mine chose not to attend college and entered the hospitality industry after high school. Starting at an hourly entry-level position in the front of the house, he learned the business working for Four Seasons and Westin, was promoted to sales manager at a Four Seasons resort and then moved on to a corporate position.
Welcome to the business where dreams are fulfilled!
Randall Pullen is President and CEO of WageWatch, Inc., which he founded in 1999 to design and implement Web-based wage and benefit surveys. Mr. Pullen‘s work experience includes over 30 years of software development and consulting to the hotel industry. Mr. Pullen is a certified public accountant and a member of the AICPA. He earned a Bachelor’s Degree in mathematics and an MBA from Arizona State University. He serves on the boards of a number of companies and associations, and is currently the Treasurer of the Arizona Housing Finance Authority.
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