Hotels losing out on P&L due to diversity bias
Hotels losing out on P&L due to diversity bias
15 NOVEMBER 2018 9:31 AM

The gender diversity gap is pretty significant higher up the hotel industry’s corporate ladder, and with employment at record highs and women comprising the majority of employees and discretionary spend, hoteliers say there are no economic reasons to maintain the status quo.

LONDON—Staffing issues are coming to an acute head in the United Kingdom, according to sources, with concerns mounting around Brexit, training, retention, hiring and the public perception of the hotel industry as a career.

And still gender diversity at the executive level isn’t representative of the overall workforce.

Speaking on a panel titled “Empowered and agile” at Deloitte’s 30th European Hotel Investment Conference, Peggy Berg, founder of the nonprofit Castell Project, which promotes diversity in the hospitality industry, said that two out of three graduates from U.S. hospitality schools are women, but when it came to opportunities at the CEO level, there is a 1-in-20 likelihood that a woman will be selected.

“We must ask ourselves, how does that affect a woman’s productivity and loyalty?” Berg said.

According to panelists, women account for 70% of global discretionary income, including hotel spend. Unfortunately, not much has improved the gender diversity gap in the hotel industry, even with dedicated conference panels comprised of all female participants addressing the issue.

“If it is only women talking about women, then that’s a problem,” said Julia Ingall, chief people and culture officer at Ennismore, the hotel firm behind the NoCo, Hoxton and Gleneagles brands. “I am an employee first, a woman second. It is incumbent to go out to schools and show everyone that everyone is capable of anything. And my goodness, there are a lot of men at this conference, and many of you have not come up to say hello to me.”

Heather Jacobs, SVP of people and culture at Four Seasons Hotels and Resorts, said diversity can often have a negative perception.

“When people hear the word ‘diversify,’ they think, ‘Oh, no, I have done something wrong,’ and that does not help anyone either,” Jacobs said.

Kate Nicholls, CEO of the United Kingdom’s principal industry lobbyist UKHospitality, said it’s still a challenge to persuade potential employees that the hospitality industry is a career and not only a stop between jobs with long and unsocial hours.

Technology can assist in exciting employees about the industry and having them become more service-oriented, Nicholls said.

Tea and sympathy
A stereotype that persists, Nicholls said, is that if employees—and mostly women it seems—move into hotel roles such as human resources, it is because such a discipline is more concrete in its hours. Panelists said HR is traditionally the place women gravitate to, which might be more attractive following maternity leave.

“Women after they’ve had a child work more hours than any other (type of employee),” Berg said. “It is as though they are having to prove themselves.”

Berg said gender-diverse companies see a 15% improvement to the bottom line, a claim supported by a panel earlier this year at the UKHospitality Summer Conference, which said that for every 10% increase in gender diversity, earnings before interest and tax rose 3.5%.

Employers need to put women in positions of responsibility, realize women learn leadership skills a little differently than men and avoid continuing to replicate decisions based on bias, which “ends in suboptimal performance,” Berg said. She added her data shows women occupied 80% of roles in HR and 35% in marketing but only 3% in development.

Jacobs said HR roles could be described as “the uberization of jobs” but that ease was making hotel companies miss out on talent.

“Some recognition must be made of the family time or other (women) have given up,” Jacobs said.

Having to leave at 5 p.m. to collect children from child care does not automatically result in lower productivity, and Jacobs gave an analogy from the hospitality industry.

“French restaurants are more productive than English ones, which unlike French ones are open all day,” Jacobs said.

Attrition factors
Employees in the industry are leaving on a regular basis, regardless of their gender, panelists said.

“I came from marketing and advertising, and one of the biggest shocks—one I was expecting, but not as much as it is—is the attrition rate,” Ingall said. “In marketing it is 20%, and we thought that was high. In hospitality, restaurants, it’s two, three, even four times as much.”

Ingall said hospitality contains all the criteria today’s employees look for in their employers: culture, community, fairness and career development.

“We need to do more to show what a forward-facing industry this is,” Ingall said.

Jacobs said work in general has moved “from muscle to brains to heart,” and the hospitality industry resides in the last category.

Nicholls said one pitfall the industry falls into is believing there is a skills shortage.

“What we have is a labor shortage. Sixty percent of our workforce is under 24, and there is a record level of employment,” Nicholls said. “We do not have a skills shortage in the industry because you can train anything. … We are the industry well-placed to pick up the people leaving the fourth industrial revolution (i.e. IT jobs).”

As the majority of the workforce, this means more opportunities for women, panelists said.

“You do not need to be either Marilyn Monroe or Margaret Thatcher,” Ingall said.

“If you are 80% sure you are right for the job, put your hand up,” Berg added.

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