Hotel markets leaders are faced with short-term financial decisions surrounding the response to the pandemic and recovery. What investments are a priority and will see a measurable return? What will enhance the changed guest expectations as well as positively impact the bottom line? Is it worth it to make that change now or wait? What is at stake? These are the questions hoteliers must consider to help them weather the crisis and prepare for new ways of operating and serving guests once we reach the other side.
But what about staff safety policies and technology? Does it pay to invest in staff safety now? The answer, most certainly, is yes. The nature of the hospitality industry leaves hotels vulnerable to employee safety concerns and workforce management challenges. And during this downtime and recovery phase, as properties plan for reopening, it has become more critical than ever to make smart decisions that protect hotel employees.
Safer Hotels on the Horizon
The call for enhanced staff safety measures across hotel properties has been heard, and it’s being answered. Since September of last year, with help from the American Hotel & Lodging Association’s monumental Five-Star Promise, more than 20,000 U.S. hotels and resorts have committed to improving safety standards for their employees. To do this, hotels are rapidly investing in and implementing employee safety devices along with enhanced training and reformed safety policies.
Ultimately, the goal is simple—make sure hotel staff feel safe and supported within their roles to combat the ongoing issue of staff harassment, abuse and injury across hotel properties. While potentially harmful scenarios cannot always be readily predicted or avoided, hoteliers do have the opportunity to equip their staff with the tools they need to receive critical support in a quick, effective manner. After all, what better ROI is there than the possibility that a device could save an employee’s life?
The True Cost of Staff Turnover
There has, arguably, never been a time in which the hospitality realm hasn’t struggled with employee retention. Hotels have long since become notorious for high staff turnover, with rates far surpassing what is perceived as normal for other industries. Not convinced? Consider this: According to the Bureau of Labor Statistics, there’s an annualized employee turnover rate of 73.8 percent in the hotel industry. That means more than 6 percent of staff depart every single month. Understandably, this is problematic for hoteliers, who are continuously tasked with the responsibility of hiring and training new employees. This figure becomes even more striking when we consider that HR experts consider a healthy turnover rate to be somewhere in the 10-15 percent range.
Even worse, experts note that it takes at least one to two years before an employee is “fully productive.” Deloitte also reports that “An average hotelier spends 45 percent of operating expenses and 33 percent of revenues on labor costs, while 52 percent of the cost of replacing staff is productivity loss and 14 percent is orientation and training.”
Staff turnover is, undeniably, an expensive and time-consuming process. And while many factors influence employee retention across hotels, there is no denying the correlation between lacking staff safety measures and employees’ decisions to move on. It would appear that, within an industry so focused on the provision of the exceptional guest experience, we’ve forgotten just how important the staff experience is, as well. After all, without talented and happy employees that feel supported and empowered within their roles, hotels will find themselves unable to deliver upon their brand promise of exceptional service.
Injuries Come with a Price Tag, and So Does Noncompliance
Workplace hazards potentially can lead to serious injuries, especially in the case of hospitality. But beyond the cost(s) associated with staff turnover, hoteliers are also encouraged to consider the cost of employee injury. Studies show that (on average) for every $1 of direct costs of an accident, a company will spend an additional $4 in indirect damages. Even further, workplace injuries and deaths reportedly cost the U.S. economy $151.1 billion in 2016.
The potential indirect costs include:
• Affiliated costs for replacement workers or recruitment
• Legal costs
• Medical expenses
• Employers’ uninsured costs
• Applicable fines and/or penalties
• Investigation time
• Reduced employee morale
• Service delays
• Loss of contracts and damage to business reputation
• Administrative costs
By focusing on preventing and effectively managing workplace injuries, hoteliers can help keep their employees safe and healthy while saving costs associated with injury and turnover and increasing employee morale. Moreover, in the case of recent legislation that has come into effect across the United States, the cost of noncompliance could cost hoteliers anywhere from $500 to $10,000.
While hoteliers must always consider the impact a new incentive or policy will have on the bottom line, it’s imperative also to consider the cost that an absence of action could represent. Ultimately, a happy staff is good for business just as happy guests are. And, in the case of hospitality, it pays to care about your staff’s well-being. With the right technology and measures in place, hotels can proactively reinforce the retention of staff who are willing and able to provide an exceptional guest experience, without assuming unnecessary risk in the process.
Robb Monkman is the founder and CEO of React Mobile.