First Hospitality President and CEO David Duncan says the labor challenges facing the hotel industry will linger for the long term, but he believes those who innovate will be poised for success.
The industry faces "a massive challenge" as many former hotel employees opt to not return to work or move into different industries and 2.5 million baby boomers retire, he said in an interview with HNN at the 2021 Americas Lodging Investment Summit.
Hotel companies "that figure out technology, those that figure out more efficient labor delivery models" will have an advantage, he said.
First Hospitality has invested in technology that can help reshape its operating model over the course of the pandemic, in part because deals for hotel assets have not yet materialized in the way executives would like, he said. However, restructuring how hotels operate will require the cooperation of brands, he added.
"We're thinking about in hotels, how do we get the brands to play along and stop cleaning rooms because most people don't care?" he said. "Brands think it's a point of pride: 'Well, we've got to have a clean room.' But on a long-term trajectory, breakfast service, cleaning the rooms and things that require labor, it just has to change because you can't ignore the macro economics."
Duncan the shortage of labor for hotels is exacerbated by issues that include increased unemployment benefits and a drastic reduction in immigration.
Similar to an assessment offered by BWH Hotel Group President and CEO David Kong, Duncan said working in hospitality is unappealing to many because of the current work environment, calling it "a tough gig, especially at the front line."
"What I found as a human shocking was, as a matter of the downturn, we all went home and reflected, right? I had the misperception that we'd all come back and be a little more kind," he said. "It's been totally the opposite. It's remarkable how unpleasant people are."
As part of the long-term labor solution, Duncan said he would like the U.S. to be more welcoming of immigrants because of the important role they play in the labor force.
"The real or larger solution involves thoughtful immigration, and stop being so protectionist. It just doesn't work," he said.
For more of HNN's conversation with David Duncan, watch the video above.