Looking at the importance of labor to an in-person industry with Tyler Morse, Chairman & CEO, MCR Hotels
In the hotel industry, we are in the people business, and you can’t clean rooms on Zoom. Without a changing of course, America may learn the hard way that working from home isn’t the wave of the future for the majority of workers. And when employees do work from home, productivity can decrease as many people simply aren’t as efficient and some may take advantage. I’ve been on Zoom calls where a participant is sitting poolside in a chaise lounge.
GET IT DONE
At MCR, we own and operate 125 hotels across 84 cities and 34 states. When fully staffed, our workforce totals about 4,000 team members at Hiltons, Marriotts, and independent hotels. As of this writing, we have 700 open jobs, down from a recent high of 1,300. The labor market has likely never been more difficult and the labor pool never smaller. When hotels closed in the pandemic’s peak, workers in management and line-staff positions got burned. Some didn’t get paid for nearly two years, so they left the industry.
You can draw a line: Largely, people aged 45 and older have remained in the business, as they don’t want to work for Amazon, while many people aged 45 and younger have moved on. Recently, a candidate with 20 years of front desk experience accepted a role as front desk director at one of our New York City hotels. The day before he was due to start, he called to say he’d accepted a finance position at a local Wells Fargo branch.
THE IMMIGRATION SOLUTION
As I see it, there’s an easy solution to this problem by way of immigration reform. Call your Congressional representative and speak out for immigrants and asylum seekers who could add great value to our economy. If every hotelier advocated for immigration reform, we could make a difference.
I went to the University of California, Berkeley, where 41% of undergraduates are the first in their families to go to college. Most of these students are second-generation Americans. Their parents came to the U.S. for the American Dream! With that in mind, we should be opening our doors to those willing to work, especially when the labor market is so challenging. It’s in our collective interest to admit immigrants who want to work, raise a family, and pay taxes in America.
We need team members to service the growing numbers of population. In 1915, the United States population was 100 million. In 1962, it grew to 187 million. By 2003, it was 290 million. Today, it’s 334 million. And those citizens are traveling. In 2003, only 20% of Americans had a passport. But in 2019, 42% had passports and that number is rising at stratospheric rates. People love traveling. Traveling is like breathing and it’s more fun, too.
WELCOME WEARY TRAVELERS
So, what are we doing at MCR to attract talent? Like all companies, we’re reviewing our benefits packages and work-life balance to stay competitive. We are looking for talent everywhere and getting creative to onboard people who want to build a career in hospitality.
We’re also strategically investing in technology that expands our labor pool. In September 2020, we purchased a cloud-based property management system, which integrates with more than 1,100 other software packages. It has been easy to use and has a modern interface that allows us to hire people and train them in 48 hours. We no longer need to find general managers and front-desk agents with experience in older, outdated systems. Thus, our labor pool has expanded by 80%. That’s game changing in a high-turnover industry like ours. Prior to this acquisition, when we built the 512-room TWA Hotel at JFK Airport, we bought 65 different software packages and had to stitch them all together. But, half of them didn’t talk to each other, so it was a nightmare. As a hotel owner and real estate developer, I don’t want to see how the soup is made. I just want a nice, warm bowl I can serve to weary travelers.
Despite the labor and demand challenges we’ve faced, MCR has kept its hotels open since the start of the pandemic, and we’ve made a huge effort to keep people employed. Senior team members have been cooking food, cleaning rooms, and checking in guests. We’re proud of our retention rate, which is higher than our competitors, and we’re proud of our team for pitching in wherever needed during a dark period for travel.
And we’re fully aboard the travel train, which is speeding in a positive direction. In the past 18 months, we’ve purchased 41 hotels – from the 725-room Lexington Hotel, Autograph Collection, in New York City to the 102-room Killington Mountain Lodge in Vermont – and we’re building a handful of others. Our team of 15 acquisitions specialists is out there every day taking people to steak dinners looking for transactions. By the look of Times Square on a recent fall weekend, the public is starting to join us at the table.
Human beings are social creatures. They like drinking together, visiting family, and seeing the world. We’ll be waiting for them, because you can’t travel on Zoom.