ILO Meeting to Address Skills Challenge in Hotels, Catering and Tourism

ILO/97/12

Press release | 12 May 1997

ILO/97/12

GENEVA (ILO News) ­ Although travel and tourism is one of the fastest growing industries and largest source of new jobs in the world, ­ and is in constant need of more skilled labour ­ working conditions in the sector "remain only marginally attractive compared with those offered in other economic activities," says a new report ( Footnote 1 ) by the International Labour Office.

Even so, future growth and employment potential remain higher than in other sectors, particularly in countries with unused tourist potential, the report says.

The challenge of reconciling the need for more and better job opportunities with profitability in this booming sector will be the topic of a tripartite meeting attended by 78 delegates representing workers, employers and governments from 50 countries, to be held at ILO Headquarters in Geneva from 12 to 16 May.

According to estimates cited in the report, over 200 million people, nearly 11 per cent of the global workforce were either directly or indirectly employed in the hotel, catering and tourism industries in 1995, a figure that is expected to rise to nearly 340 million by 2005. In absolute numbers, South Asia and China account for over half of all travel and tourism workers, with nearly 108 million employed. The combined figure for Australia, Japan and New Zealand is around 8 million. In the European Union, over 18 million are employed in this sector. In North America, 16 million.

In relative terms, the sector provides nearly 25 per cent of the regional total of employment in the Caribbean, compared to 8-12 per cent in most other regions. In 1995, the sector produced 10.9 per cent of the world's Gross Domestic Product (GDP) and contributed US$ 1.6 trillion in wages and salaries, according to the World Travel and Tourism Council (WTTC). By the year 2010, tourism, measured in terms of international arrivals, is expected to double to more than 1000 million (one billion). Forecasts of international tourism suggest the fastest growth in East Asia and the Pacific, followed by South Asia.

Among the features of work in the sector, the report cites low wage growth, overtime, irregular working hours (for example, nights and week-ends) and the part-time or seasonal nature of much hotel, catering and travel work, the bulk of which is done in small- to medium-sized enterprises. This leads to high levels of employee turnover, which is "certainly one of the most important difficulties faced by employers and employees alike in the sector."

These factors, combined with the challenge of new technologies and increasingly diversified services, mean that higher salaries are increasingly on offer for skilled workers in modern, well equipped hotels, kitchens and travel agencies, while wages for less skilled workers stagnate. Workers organisations are thus concerned that productivity improvements "may not translate into improvements in employment and working conditions or could lead to reductions in salary and job opportunities." Meanwhile, employers stress that new technologies can "raise the skill profile of the labour force, and allow a flatter organisation of enterprises, thus empowering more workers."

The report says that while many large hotel chains and travel groups are recognising the need for a stabilised labour force and thus building up modern strategies of human resource development "irregular working hours, an increase in part-time work and a stagnation of salaries are noted everywhere."

The report notes that the impact of new technologies, product differentiation and increased competition in the hotel, catering and tourism sectors have "compelled employers to adopt new methods of human resource management," which pose significant challenges to workers and management alike and underscore the need for good industrial relations.

For example, computer-based technologies in hotels have led to tighter control of workers' performance and improved use of working time through more systematic deployment of labour according to varying needs. This results in flexible working hours and more part-time employment. The report notes that employees working in the "hotel of the future" will have to be more knowledgeable about technology. However, "this requirement will eventually result in a higher cost per unit of labour, countervailing the lower share of labour costs in the enterprise."

In catering activities, the introduction of pre-prepared food products is likely to reduce the amount of training for kitchen staff, resulting in cost savings. However, "the consequent de-skilling of the labour force will also be reflected in lower wages."

In travel agencies, new, computer-based information technologies are decreasing the number of workers rapidly, particularly in larger enterprises. However, trends also point to an increase in the number of very small agencies with close customer contact and therefore to new job opportunities.

The report notes a widespread consensus in the hotel, catering and travel sectors that "formal training falls far short of the new requirements for skilled workers." Hotel and tourism schools experience difficulties keeping up with the pace of change. Many countries lack special structures for training hotel and tourist staff. While there are no instant solutions to the mismatch between skill supply and demand, the report cites the need for more on-the-job training, technology transfer and an improved institutional framework for developing small and medium sized enterprises.

Footnote 1:

New technologies and working conditions in the hotel, catering and tourism sector. Report for discussion at the Tripartite Meeting on the Effects of New Technologies on Employment and Working Conditions in the Hotel, Catering and Tourism Sector. International Labour Office, Geneva, 1997. ISBN 92-2-110430-3.