Recruiting & Retaining Employees in an Evolving Workforce Environment
Two years ago, Gen Z began to overtake Baby Boomers as a percentage of the US work force (see CHART 1). Millennials had already overtaken the Boomers a decade ago. (See CHART 2). And Millennials have been a larger part of the workforce relative to Gen X since the late teens. Demographics are destiny. Whatever you think about today's workforce, it will be different in the next 5 to 10 years and Gen Alpha will be joining in ever larger numbers. It's all inevitable and unavoidable.
A quick primer reminds us that the cohorts are distributed as follows:
Baby Boomers: 1946–1964
Gen X: 1965–1980
Millennials: 1981–1996
Gen Z: 1997–2012
Gen Alpha: 2013–present (some sources extend to 2024 or 2025)
These shifts touch on all aspects of recruiting and retaining employees as we deal with key challenges in the following areas.
The Gig economy and competition with Gig employers.
Impact of fair work week laws.
Industry perceptions relative to opportunities and career paths.
Benefits and compensation.
Returning to office and issues around belonging.
Before delving into those challenges and potential approaches, it is useful to review some of the key differences among the various cohorts and to pay particular attention to how Millennials and Gen Z differ from earlier generations.
Technology and Communication: Baby Boomers and Generation X adapted to technology as it evolved, whereas Millennials and Generation Z grew up with it. Millennials popularized social media and online networking, whereas Generation Z embraces platforms like TikTok and Instagram for instant communication and content creation. Also, with more digital natives, there's greater demand for secure, ethical tech practices.
Values and Priorities: Baby Boomers value stability and hierarchical structures, Generation X prioritizes work-life balance and independence. Millennials have brought a greater focus on purpose-driven careers and inclusiveness, while also valuing work-life balance. Generation Z values social responsibility and sustainability along with opportunities for growth and change.
Education and Career Expectations: Baby Boomers often followed traditional career paths, with a focus on job security. Generation X introduced a greater focus on work-life balance and more freelance work. Millennials further popularized startups and remote work, and Generation Z favors flexibility, entrepreneurship, and gig work. Of course, gig work has also shown appeal to Boomers looking for part-time work and an opportunity to earn additional income.
Cultural and Social Values: Each generation has unique perspectives on diversity, inclusion, and social issues. Baby Boomers experienced the civil rights movement, Generation X witnessed the fall of the Berlin Wall, Millennials more frequently came to advocate for LGBTQ+ rights (a usage that's only become common in the last 20 or so years). Generation Z has absorbed the focus on diversity and LGBTQ+ rights while adding a focus on climate change.
Economic Impact: Generational differences influence economic trends such as housing preferences, consumer behaviors, and investment strategies. Today, Baby Boomers dominate wealth accumulation (owning over 50% of wealth), Generation X is managing mid-career responsibilities, Millennials still face economic challenges associated with student debt, and Generation Z navigates the gig economy and rising education costs. Younger workers are more likely to freelance, side hustle, or pursue entrepreneurial paths or participate in the Gig economy.
Leadership and Management Styles: Gen Z favors collaborative environments and flattens traditional power structures. They want real-time feedback, and mentorship is valued more than annual reviews. And digital fluency is becoming a leadership prerequisite, not just a nice-to-have.
Organizations must now manage across these generations, and the hospitality industry is no exception. Further, there are major challenges with obtaining and retaining an effective workforce, especially as the younger cohorts have different expectations as to what makes for a satisfying job and career.
Across the industry and across the country, I encounter more and more properties that perceive themselves to be short-staffed and, in turn, use contract labor to fill those gaps. In some instances, organizations find it easier to use contract labor as it's often readily available and reduces the need to constantly recruit staff. In other instances, it is because employees prefer contract work because it gives them more flexibility. These challenges are more pronounced in markets where it is more difficult to find employees, such as resort environments. At the same time, perhaps organizations are taking the easy way out by not working to understand what they need to do to recruit and retain employees, and by not taking the necessary steps to make employment with them more attractive.
Understandably, different markets have different challenges. Seasonal resorts in markets like Florida and Colorado struggle to staff at the right levels as they move from peak to shoulder to off-season. Some, notably mountain resorts, continue to make themselves more attractive in the off-season which, in turn, makes it easier to retain a core staff on a year-round basis. And numerous resorts depend on J-1 workers along with H2B visa workers during season.
If our industry is to improve our ability to recruit and retain employees we must consider and effectively respond to the several distinct challenges noted above.
1. Gig Employment
The appeal of gig employment is the sense that one has great freedom. Gig workers can set their own hours and work as much or as little as they want. They can take time off when they want to or work long days when they want to increase their income. They can work for multiple gig companies. They can drive for Uber or Lyft, or Door Dash or work for other more local delivery organizations. But there are also notable drawbacks to gig employment. It tends to be solitary. People often want to feel that they belong to something greater than themselves. They want colleagues.
Many also want stability and a steady paycheck as that makes it easier to manage one's finances. Our industry offers numerous inducements to people looking for more consistent work and more stability. But we can better compete with gig employers if we also make other accommodations, which will be discussed later. We offer much that can be appealing to gig workers if promoted properly when recruiting.
2. Impact of Fair Work Week Laws (also sometimes referred to as Predictive Scheduling)
Since Fair Work Week statutes were first introduced in San Francisco, they have spread to several other municipalities (New York, Philadelphia, and Chicago, to name a few). And Oregon is the only state which, to date, has passed statewide legislation, though various approaches are under consideration in Colorado, Michigan and other states. Some basic principles of Fair Work Week laws have been a component of Collective Bargaining Agreements (CBA's) for many years – most notably the requirement that schedules be posted two weeks in advance and that there be a minimum rest period between shifts (i.e., not scheduling someone to work a late shift one night and an early morning shift the next day).
The core objectives of Fair Work Week laws are to provide a better work-life balance by giving people ample opportunity to know when they will be working and allow them to plan accordingly. They also offer transparency in terms of the scheduling process. Some rules limit the time frame in which schedules can be modified and also incorporate penalties for violations. By adapting the basic principles of Fair Work Week laws the industry has an opportunity to recruit people who are looking for more stability while still desiring a better work / life balance. And an organization need only adopt the core principles without the penalties included in various municipal statutes.
3. Industry Perceptions
Over the course of the last 20 years, I have been a member of a couple of different Boards associated with the College of Merchandising, Hospitality and Tourism at the University of North Texas. In conversations about recruiting students, we recognize that our industry has an image problem. A lot of people (and parents of prospective students) think of hotels as places where people check guests in, wait tables and clean rooms. I, like many people reading this, grew up waiting tables, washing dishes and tending bar. I have met dozens of hotel managers who may have started in hourly jobs but have gone on to senior management positions at hotels and in hotel companies. We all recognize that more schools have added hospitality programs, but – as an industry- we need to do a much better job of communicating a career path.
The hospitality industry is one in which an individual in their early 30's could potentially run a multi-million-dollar business. It is also an industry that provides opportunities to live in different states and even different countries. Few industries offer the same opportunity for travel and new experiences. Additionally, people who go on to run full-service hotels and resorts make a great living in an industry whose core mission is to give people a good experience. That's very appealing to many people.
But just as we fail to promote the positive aspects of our industry vs. gig employers, we do not effectively communicate the opportunities we offer for careers and new experiences. And, as importantly, while no industry is recession or pandemic proof, the hospitality industry tends to be growth oriented as long as populations grow and people travel.
4. Benefits and Compensation
As I noted earlier, hotels need to promote the benefits that they offer to prospective employees. People who have FT jobs for hotels get various benefits such as paid time off and access to insurance. Many hotels offer free or reduced cost meals. Many offer shift meals. Most management companies and brands offer reduced cost access to hotel rooms for travel. Hotels pay into Social Security whereas gig workers must cover the entire cost. And union employees receive the benefit of pension plans and guaranteed wage increases while under contract. Our industry needs to promote these benefits and the potential for a more secure income.
5. Community and Returning to Office
More companies are requiring people to return to the office as Work from Home is now seen as posing different challenges. One of the appeals of going to a place of work is the opportunity to develop camaraderie in a workplace where an employee sees people on a regular basis. People who work together regularly build rapport and develop a sense of belonging. While there are certainly many people who work from home and enjoy it, the hospitality industry, by its very nature, is one which encourages people to help others have a good experience. And even as organizations reduce the need for human interaction with apps that allow for making reservations, checking in and entering rooms, people still look to hotels as a place to get service when they need it.
In terms of appealing to prospective employees, hotels are still places where one can develop relationships with colleagues, a human factor which is appealing to many. Also, people working remotely do not learn to manage people as effectively as people who are face to face and as rapid advancement opportunities are a key promotional aspect of the industry, offering people a place where they can work with others and be mentored is a true plus for the industry.
There are also opportunities to make our industry more appealing for people looking for part-time jobs and numerous positions lend themselves to short shifts which help hotels during peak demand periods. With better promotion and more effective messaging, the industry can do a better job of obtaining and retaining employees.
There are never easy solutions to the challenges which businesses confront. But by more effectively promoting the broad benefits available to people who pursue hospitality careers, and by continuing to promote the professionalization of the industry we can all do a better job of recruiting and retaining employees.
Originally Published in Hotel Business Review - Hotel Executive
