All signs point to a more favorable labor environment in 2026 compared to recent years for hoteliers, but there is also a sense that the overall environment could change at any time.
Greg Presnol, vice president of operations for third-party operator Palette Hotels, said almost across the board, this year is shaping up better than 2025 and 2024.
"Indicators suggest conditions might be stabilizing after several years of having volatility," he said. "Although the challenges still remain for us, particularly in hospitality and certainly other service-driven sectors, we're seeing more of a balanced hiring at this point compared to the last few years.
"Applicant flow has certainly improved, especially post-pandemic, and what we were seeing for the first few years beyond that. And then at the same point, we're noticing wage growth is certainly no longer accelerating at the same pace that it was in the last 24 months."
Kerry Ranson, partner and president of operations at Raines, agreed the labor environment is feeling a lot more positive, at least for the time being.
"It really started to kind of take shape in the latter part of the second quarter of the year where we started seeing fewer positions opening, quicker times to fill positions that previously had taken us a little bit more time to fill," he said. "We're seeing more people" staying in positions, too.
Ranson said part of the recipe for success at hotel companies, including Raines, is a greater dedication to retention efforts, particularly providing pathways to career growth.
He said recruitment efforts are also boosted by companies' willingness to be flexible on scheduling.
"That has been a big focus for us, to break the old hospitality industry status quo of saying 'You're working 7 a.m. to 3 p.m. or 3 p.m. to 11 p.m. shifts,'" he said.
Presnol noted retention and career pathways are increasingly important in part because they've become key ways of reliably filling on-property leadership positions such as general manager or director of sales.
"We've definitely moved from, 'How fast can we hire somebody?' to 'What do we need to do to develop the people we have?'" he said.
But Ranson said the pool of available talent for leadership positions has also improved noticeably compared to just a few years ago. He said he's seen a shift in the types of candidates he encounters during GM interviews.
"You start seeing in the interview process that the knowledge, the skill set and the professionalism was turning" around the halfway point of 2025, he said.
Both Ranson and Presnol agreed that wages are continuing to trend upward, but not at the explosive pace seen during the worst points of post-pandemic labor shortages.
"Wage growth is certainly not accelerating at the same pace that it was in the last 24 months," Presnol said.
Ranson described wage growth as being "in a more consistent environment."
"The market was just out of control," he said, noting sometimes comparison studies of other employers meant having to increase pay 25% when "the skill set we were getting did not warrant that."
He said as layoffs became more prevalent in other industries, the hospitality sector began to look better in comparison, spurring some former hospitality workers to return.
The biggest remaining concern for the labor market in Ranson's eyes is just how sustainable the current level of stability will be, and he noted the hotel industry has had to grow more accustomed to uncertainty in recent years.
"That's where my concerns lie," he said. "It's just with the headwinds that we don't know about and what's going to happen. The administration is all over the board."
He said the employment environment is unpredictable in the same way the demand environment has been.
Both Ranson and Presnol said there are some concerns about how immigration policy can impact the employment environment, but it hasn't affected their properties directly. Ranson said the biggest impact has been on the mindset of employees rather than the actual availability of workers.
"It's not an issue we're having with call offs in significant portions or what not, but it's something we have done preparation with our HR team in different markets," Ranson said, noting they have more contract labor lined up in case even though they're decreasing their overall reliance on contract labor.