Travel Is Coming Back. Will the Workers Be There Too?

BY Emily McCrary-Ruiz-Esparza | July 03, 2021

In the post-pandemic era, leisure travel has taken off like a skyrocket. As the July 4 weekend approached this week, the Transportation Security Administration (TSA), reported screening 2.15 million airline passengers on July 1, up 3% from the same day in the pre-pandemic summer of 2019. Hotels are on the comeback too. Occupancy in late June reached the highest level since October 2019.

The surge is likely to continue. In a survey, 60% of Americans said they plan to travel more this year than they did in 2019. This is great news for the travel and hospitality industries, but now they face a new challenge: After drastically cutting employees during the pandemic, can they bring back their workforces swiftly and smoothly enough to meet demand? The airline industry, for its part, is going full throttle. Delta Air Lines has announced plans to hire and train 1,000 new pilots by next summer and 1,300 reservations agents by fall.

For hotels, however, the recovery is a more gradual and complicated one, in part because the lucrative business-travel market is proving slower to recover than leisure travel. At the same time, some workers have been reluctant to return to the workforce. Luke Marble, who leads compensation and benefits for InterContinental Hotels Group (IHG), the organization behind such brands as Crowne Plaza and Holiday Inn, spoke with me about the journey of bringing staff up to full strength at From Day One’s June virtual conference, “The New Benefits that Employees Need and Want Today.”

What incentives will bring employees back–and attract new ones? Marble said his HR philosophy is based in compassion, and he hasn’t forgotten who he’s there to support. “I think it's about culture. IHG puts hospitality above everything else, and we hopefully treat our employees like guests,” he said.

Speaking about the hospitality workforce: moderator Emily McCrary-Ruiz-Esparza, left, and Luke Marble of InterContinental Hotels Group (Image by From Day One)

That philosophy came into play in the early days of the pandemic, when hotel revenues plummeted and IHG had to make difficult decisions about the 400,000 people it employs in 6,000 hotels in more than 100 countries. “That was such a tough thing to determine how to do in the last year,” Marble said. “Do you furlough? Do you terminate? What's the right thing to do just to support another human being to the best of your ability?”

While many companies in the hospitality industry laid off large swaths of their labor forces, Marble said IHG chose to furlough workers instead. “We said ‘You're on furlough,’ and we made a conscious effort to ensure that whatever subsidy we could provide as a company would not violate the benefits they receive from federal and state programs. And I believe we've treated our employees to the best extent humanly possible.”

The choice to furlough rather than terminate may make it easier for IHG, compared to competitors, to bring back workers. But Marble said it’s still a challenge. Millions of employees remain out of the workplace as a result of lingering health concerns, lack of child care, and evolving worker preferences about what kind of work they want to do.

By and large during the pandemic, Marble said IHG was able to keep many workers on full-time at 30 or more hours per week, plus benefits, despite sluggish bookings, but the company has struggled to keep hours consistent for many hotel employees. “Without the revenue coming in, it's difficult for us to guarantee the hours that people need both for benefits and for compensation,” he said. “But on top of that, we have the programs that are available within states and different geographic regions that may not make it attractive to come back unless you can guarantee that, and we're working primarily with that in specific locations.”

More than three million women have left the workforce in the U.S. as a result of the pandemic, and IHG is making specific changes to encourage their return to work. “We definitely recognize the stress that the current environment has placed on working mothers and potential mothers and families in general, and we're doing the best we can to address those concerns. And for the most part, I think our strategy has been successful.”

The InterContinental Hotel in Cannes, France (Photo by Missalgong/iStock by Getty Images)

The strategy includes discounts and subsidies for child care, expanded paid parental leave (now a minimum of eight weeks at 100% pay) and expanded short-term disability to birth mothers (now a minimum of 14 weeks at 100% pay).

IHG is doing its best to accommodate new preferences for working arrangements as well, Marble said. The company been able to give corporate employees flexible schedules, but IHG is still figuring out remote work arrangements for those who want to move to a state outside their office location. “I do recognize that some companies have come out and said you can work anywhere. But I don't know how they do that. Some of those companies have much larger bank accounts that allow them to do things quicker. For us, we're gonna have to be a little bit reticent to allow that much opening.”

Workers have said they want new and expanded health benefits as well. Marble acknowledged the importance of those needs, but was frank about the tension between the usefulness of those incentives and their cost. The Society of Human Resource Management (SHRM) estimates that employer health-plan costs could rise as much as 5.3% in 2021. For a company the size of IHG, that cost is significant. “IHG runs a $100 million health care budget. So a 5.3% increase is five million bucks,” said Marble. “And while the company picks up 70% of that cost, that's $3.5 million in cost against the P&L, and the employees have to pick up another $1.5 million. Our job is to provide benefits as stable and as good as we can without disruption to them, and that's a responsibility I take very personally.”

The stubbornly slow return of business travel is another variable in the industry’s planning. Business travelers normally help fill IHG hotels Monday through Thursday–leisure travelers tend to dominate the weekends–and Marble supposes it could take more than a year for business to return to recover its normal rhythm.

This creates staff scheduling problems. “How do you staff a hotel for two or three days of work versus shifts of work that used to have to run 24 hours a day, seven days a week?” he said. “Even though there were different types of travel, the hotels work consistently at a certain level of occupancy, and we're going to struggle with that.”

This means that drawing employees back to work will have to be a steady process, with no sudden moves, Marble said. “Our revenue is a little bit volatile right now. We have to recognize that, and we can't be reactive,” he said. “We have to be calm and contemplative about how we address this. I probably will for quite some time.”

Emily McCrary-Ruiz-Esparza is a writer, editor, and content strategist based in Richmond, Va.

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