Salary Trends in the Hotel Industry — 2015
Last month [May 2015], the employment in the Hotel/Hospitality industry rose by 57,000 and accounted for 20% of all new non-farm job growth. It’s no doubt the hotel and hospitality industry is beginning to thrive once again.
With the recovering of the economy, more people are beginning to travel again and job-loss fears are beginning to abate. Hotels are once again beginning to meet their profit goals and hotel executives are becoming more comfortable with the idea of leaving their current roles in search of other opportunities. Where do the realities of the economy and hotel labor market leave hotel owners as we approach 2016 salary negotiations?
Below is a list of four top hotel salary trends you can expect to see as 2015 draws to a close.
Download complete Whitepaper: (click below)
“2015 Hotel Executive Salary Guide”
- Revenue Management Executives salaries will increase.
The increased emphasis on utilizing revenue management strategies to maximize overall revenue has made it indispensible to success in the hotel/hospitality industry. With the continuing expansion of the hotel market and limited pool of qualified hotel revenue management professionals, hotel owners and general managers will see an increase in the cost to attract and retain the top revenue management talent.
This evolving discipline and the unique skill sets required has given revenue management executives more power to choose where they want to work and more power to negotiate salary raises.
- Salaries will play a less significant role in retaining hotel executives.
With the recovering of the economy job-loss fears are beginning to abate. Executives are placing more of an emphasis on company culture, and the growth trajectory of the company, rather than their salaries. “The truth is, working for the carrot displaces the human need for purposeful achievement,” states Charles S. Jacobs, Author and Fortune 100 consultant. Their compensation is more of a ticket to entry than a game changer; and is rarely the reason they jump ship. Companies who are able to realize and offer their executives more than just a six or seven figure salary will find that they’ll not only increase the retention rate of their executives but they’ll also attract other top executive talent.
- Compensation for Managers/Executives with boutique/lifestyle hotel experience will trend higher than average.
“The market for Managers/Executives with boutique/lifestyle hotel experience has tightened dramatically in the last few years,” says Efrem Harkham, LWH Hotels Founder and Chairman. As big hotel chains and smaller boutique brands open new [lifestyle/boutique hotels], they’ll look towards executives with boutique hotel experience to help bring customers a more unique and personalized hotel experience.
The number of boutique hotels is projected to grow by as much as 10% in the next 10 15 years; and will account for 6% of all hotels in the US.
- Performance bonuses are making their way back.
Performance bonuses, which had all but dried up during the lean years when no one was traveling, are making their way back. “General Managers and hotel executives are seeing yearly performance bonuses around 20 percent and as high as 40 percent of their annual base salary,” says Victor Fernandez, executive director of insights for Black Box Intelligence.
Chain hotels owners may be paying out more to their executives and employees, especially through bonuses, but that means the hotels are meeting their overall profit goals.
Sources
Consumer Alliance. (n.d.). The concept of hotel revenue management [Blog post]. Retrieved from http://www.customer alliance.com/en/articles/hotel_revenue_management_1/
Customer Alliance. (n.d.). A new approach to hotel revenue management [Blog post]. Retrieved from http://www.customer alliance.com/en/articles/hotel_revenue_management_2/
Hotel News Resource. (2013, October 31). Independent boutique hotels report increase in demand for 2013 [Blog post]. Retrieved from LHW Conference Update website: http://www.hotelnewsresource.com/article74696.html
Rossheim, J. (n.d.). 2014 salary trends that will impact staffing [Blog post]. Retrieved from Monster: Recruiting and Hiring Advice website: http://hiring.monster.com/hr/hr best practices/recruiting hiring advice/strategic workforce planning/salary trends 2014.aspx
Stoessel, E. (2013, July 11). Salaries climb as industry strengthens [Blog post]. Retrieved from Restaurant Hospitality website: http://restaurant hospitality.com/hrlegal/salaries-climb-industry-strengthens
Trotter, S. (2014, May 22). Top ten reasons why you should develop a boutique independent hotel [Blog post]. Retrieved from http://www.boutique-hospitality.com/top-10-reasons-why-you-should-develop-a-boutique-independent-hotel/