Data, data, data. The hotel industry is swimming in it. Between sifting through your STAR reports and budgets, here’s a list of some important industry research that has been released this month and should be on your radar.
TRevPAR Hits Record High
Hotels in the United States experienced the highest total revenue per available room on record in March, according to a recent HotStats report that tracks full-service hotel data. That figure was propelled by a 6.8 percent year-over-year increase in non-rooms revenue, which offset a 0.6 percent decrease to $181.89 in revenue per available room.
Furthermore, U.S. hotels saw a 3 percent increase to $126.47 in profit per room during the month, according to the report. This was the fourth consecutive month of gross operating profit per available room growth and was just below the recent high recorded in October 2018 at $126.51.
Despite the drop in RevPAR, achieved average room rate at hotels was up 1.3 percent year over year against a 1.6 percentage-point decline in room occupancy, HotStats reported. Profit growth was helped by cost savings, which included a 0.3-percentage-point decrease in payroll as a percentage of total revenue, in addition to a 0.1-percentage-point saving in overheads.
Related Story: Profit gains for U.S. hotels slow in 2018
Labor Issues? Look to the Gig Economy
Speaking of labor, a new study has found that the gig economy is thriving in the hotel industry as the sector reaches a surplus of inventory and talent continues to become scarce. Hospitality consulting firm Strategic Solution Partners and executive search firm SearchWide Global surveyed 350 contractors and hoteliers for its Hospitality Gig Economy Study.
Contrary to popular belief, millennials do not comprise the majority of hotel gig workers. Less than 20 percent of these workers are ages 22 to 37, while 26 percent are 45 to 54, and 45 percent are between the ages of 55 to 65. Ten percent of these workers are aged 65 and older.
“With national employment rates at record highs, and an increasing number of new hospitality positions coming to market, hoteliers are challenged to find the right talent,” said Bill Scanlon, president and CEO of Strategic Solution Partners.
Of those surveyed, senior-level contractors in the hospitality gig economy are an even split between male and female, between the ages of 45 and 65 (71 percent), with 10-plus years of experience (88 percent), have worked in more than 10 hotels (44 percent) and are looking to retire after the age of 68 (47 percent). Nearly 30 percent of respondents cited work-life balance as the main driver for contractor work. Of those surveyed, 64 percent feel appreciated for their varied expertise and unique perspectives, and 88 percent are either satisfied or very satisfied with the contractor workforce economy.
From the hotel perspective, findings showed that 76 percent of hotels recruit contractor positions, with 69 percent recruiting for mid-level positions or above requiring five-plus years of experience. As far as how many will hire contractors in the future, 47 percent plan to hire the same number of contractors as last year, and they are 87 percent satisfied or very satisfied with this staffing method. The key trait that hoteliers value most in contractors is how fast they can join the team, according to the results, where 74 percent want to bring in a contractor quickly and 56 percent feel they can find them in less than two weeks. In addition, 64 percent of hoteliers agree that contractors offer the senior expertise they are looking for.
Travel Sector Continues Growth
Not only is the competition for quality labor growing but travel itself is booming. According to the U.S. Travel Association's latest “Travel Trends Index,” travel to and within the U.S. grew 2 percent year over year in March. That marks the industry’s 111th straight month of overall expansion.
However, researchers noted that this growth was overshadowed by news that international inbound travel fell 5.4 percent year-over-year in March, after edging down only 0.2 percent in February. That decline was likely due to the timing of Easter, which fell on April 1 last year and April 21 this year.
Looking ahead, researchers expect that global economic activity will improve yet remain soft in the second half of 2019, supporting predictions that international inbound travel growth will be positive but slow.
Meanwhile, domestic leisure travel recorded 3.2 percent growth in March, while the business segment increased 2 percent. Continued moderation in consumer spending, vacation intentions and business investment are expected to cause both segments of domestic travel to wane in the coming months, according to the report. Domestic travel as a whole is predicted to grow 2 percent through September 2019. Domestic business travel is projected to grow 1.6 percent, while domestic leisure travel is projected to increase 2.2 percent.