The hospitality industry is one of the largest employers in the UK, with various businesses ranging from restaurants and bars to hotels. While it has always been a popular choice of employment, employee retention strategies have always been challenging.
The hospitality industry in the UK has a high employee turnover rate, according to a recent study by YouGov. The annual staff retention level in the UK’s hospitality industry is 70%.
What are the reasons for high employee turnover in the hospitality industry, and what can managers do to reduce it? Employee turnover can have many negative consequences for a hospitality business, so managers need to understand the causes and take steps to reduce them.
This article examines the causes of employee turnover and the challenges associated with retaining employees in the hospitality industry. It provides advice and strategies for preventing staff burnout and retaining employees.
What are some of the reasons why employees might leave the hospitality industry?
Employee turnover is the number of employees who leave a business within a specified period of time. This includes those who resign voluntarily, retire, or are made redundant. The ability of a business to retain its staff is known as employee retention.
It is notoriously difficult to manage employee turnover in the hospitality industry. This is due to a number of factors, some of which are out of the control of business owners.
Some of the most common reasons why people choose to leave the hospitality industry are as follows:
Unsuitability for the Role
One of the most challenging aspects of owning and managing a business is high employee turnover or low employee retention. This can be an indication that your establishment is not a desirable place to work.
Sometimes an employee is not a good fit for the position they were hired for, which becomes apparent after they start working.
Not everyone is cut out for customer service. Some people don’t have the temperament or skillset required to excel in a fast-paced hospitality environment – no matter how much training they receive.
Although it can be disappointing, this does not reflect the company’s ability to create a positive workplace for its employees.
Unsociable Hours
Hospitality businesses are typically open during different hours than other businesses. This is because the busiest times for these establishments tend to coincide with when most of the working population is available to visit.
Hospitality workers can expect to work holidays, late evenings, and weekends.
The challenges of maintaining a good work/life balance can eventually become undesirable for even the most dedicated employees. As a result, they may start looking for a less demanding job in this respect.
In the hospitality industry, hours are often longer than in other sectors. Breaks are not always as easy to take.
The hospitality industry is one of the most common places where employee retention is an issue due to employees being overtired.
Limited career advancement opportunities
The hospitality industry is an ever-growing and thriving sector, providing various opportunities for work and employment.
However, due to limited career advancement opportunities, employees may find themselves at an impasse and choose to pursue other career paths. Low wages, long hours and a lack of promotion paths can dishearten many workers; the hospitality industry is often seen as a stepping stone to bigger and better prospects elsewhere.
Furthermore, the industry can be demanding, with workers often having to forgo the usual benefits of a regular working schedule.
These factors, combined with the lack of career advancement opportunities, can lead many employees to feel discouraged and choose to move on to another sector.
Lack of Flexibility
One of the main reasons people tend to leave the hospitality industry is due to unsociable hours. Another big appeal of hospitality work is the flexibility of shifts and schedules; however, this is also a common reason for staff leaving.
The hospitality industry is a dynamic and ever-changing field, so staff must be able to adjust and adapt to the needs of the business. For example, if a restaurant gets a large booking, they may need to call in extra staff at the last minute.
It is not uncommon for schedules to change at the last minute, which can be stressful for employees. There aren’t many opportunities for employees to have a say in their schedules.
If a business has a small staff, it can be difficult for employees to take time off without feeling like their absence will have a negative impact on other staff members.
Inadequate staffing
The hospitality industry is one of the most labor-intensive industries, and inadequate staffing can seriously affect businesses. Low staffing levels can lead to employees feeling overworked, undervalued, and unsupported, leading to increased stress, burnout, and, ultimately, high staff turnover.
This can be especially damaging in the hospitality industry, which relies on customer service and the quality of the experience they provide. Low staff levels can lead to long wait times, unsatisfactory service, and a sub-par customer experience.
This not only impacts the customer’s experience but can also lead to staff feeling overworked, undervalued, and unsupported, further contributing to the turnover of employees.
Inadequate staffing levels can also lead to decreased morale and productivity and higher operating costs due to the need to hire temporary staff or outsource services.
Unsatisfactory work hours
Working hours in the hospitality industry are often unsatisfactory, resulting in high employee turnover. Employees often must work long, unsociable hours, sacrificing time with their family, friends, and hobbies. Furthermore, these hours can be unpredictable, making it difficult to plan.
This lack of stability can cause many employees to leave the hospitality industry, as they may be unable to commit to a reliable schedule.
Furthermore, employees may feel they are not adequately compensated for the number of hours they are working, leading to an overall sense of dissatisfaction.
Employers need to provide a reasonable working schedule that benefits both the employees and the business. By ensuring a reasonable number of hours and a consistent, predictable schedule, employers can help to retain their valuable employees.
Lack of Recognition
A successful shift in the hospitality industry is one in which all operations run smoothly, and guests leave content and satisfied.
When shift changes go smoothly without any complaints or errors, it is easy for owners and managers to take for granted the employees who are working hard to make that happen.
It is easier for people to focus on mistakes than it is to reward a job well done.
Although they may not always receive the recognition they deserve, employees often feel a sense of relief and accomplishment after a successful shift.
This can result in feeling undervalued and discouraged by the industry, despite providing excellent customer service.
Toxic or Unhealthy Environments
The hospitality industry is known for being fast-paced and sometimes stressful. If communication breaks down or interpersonal conflicts are left unresolved, it can lead to a toxic work environment.
Several signs may indicate a toxic work environment, such as:
- Lack of communication among employees and management
- Exclusive behaviors and cliques forming among employees
- Ineffective leadership
- Unmotivated employees
- High staff turnover
Apathy can develop in an environment where staff feels unvalued or appreciated, decreasing job satisfaction and motivation.
Customer service will be affected if staff is disengaged from their role or encouraged to go above and beyond. This could threaten the business’s reputation and success.
Working in an unhealthy or negative environment can negatively affect an individual’s physical and mental well-being. This could lead to staff feeling they have no choice but to leave the workplace.
This is a common reason for low employee retention in the hospitality industry. Mental health and well-being are important factors when managing a hospitality business. For more information, review our article: Managing Mental Health and Wellbeing in Hospitality.
Minimal Growth Opportunities
Many young people enter the hospitality industry and find success within it. However, many eventually leave the industry for other opportunities. There are various reasons for this, but one of the most common is the lack of advancement opportunities.
Many people look for potential promotions or advancement opportunities to further their careers. If these options are limited, they may look for new opportunities elsewhere.
The turnover rate in the hospitality industry can be high, as many businesses view their employees as part-time workers who they expect to move on anyway. This can affect employee retention, as turnover can be costly for businesses.
This attitude can hold people back from advancing in their careers in the hospitality industry.
Low job security
Low job security is a serious issue in the hospitality industry that can lead to a high employee turnover rate. In a competitive market, many employers cannot guarantee job security for their employees due to the limited number of positions available.
Furthermore, employers often cannot guarantee job stability due to the industry’s seasonal nature, in which staffing needs can fluctuate significantly.
This lack of security can cause employees to feel uncertain about their future and leads to them seeking career opportunities elsewhere. Additionally, employees often leave the hospitality industry if they find other positions that offer higher salaries or better benefits.
Low job security is a major factor in why many employees leave the hospitality industry.
Why are staff retention strategies Such a Problem in Hospitality?
The average length of tenure that hospitality workers spend at a business is 12 months, which can have several negative consequences for a hospitality business.
Frequent staff turnover can be costly in terms of time and money spent on finding, hiring, and training new employees. According to Big Hospitality, employee retention in the hospitality sector is a key issue, with a lack of retention costing the sector £275 million annually.
The time investment for training new staff members only to have them leave shortly after does not seem like a wise use of company resources.
The impacts of this extend to customers as well. They visit hospitality businesses expecting to receive great customer service.
The high staff turnover rate can often mean businesses are understaffed and have to scramble to recruit or train new employees. This can lead to a decline in the level of service that customers have come to expect.
This can damage a business’s reputation and cause a loss of profit through customers not returning.
Why is it that the hospitality industry has difficulty retaining staff? This has been a problem in the industry for a long time and does not seem to improve.
Despite employees’ reasons for wanting to leave the industry, other factors are often at play.
Misconceptions about the Industry
When recruiting staff, it is natural to want to make the role sound as appealing as possible.
However, this could indicate a larger problem regarding common misconceptions about the hospitality industry and a contributing factor to employee retention issues.
Focusing only on the positive aspects of a job – for example, “it’s like getting paid to socialize with people” – can create a false impression and hide the true nature of the role. This isn’t just an issue for employers but for employees as well.
Employees may have different ideas about what their role in hospitality will entail. Some may expect to work shorter hours and only occasionally work on weekends. The employees will look for another job if these expectations are unmet.
Students and Seasonal Workers
The hospitality industry has long been seen as a provider of entry-level positions often attractive to younger workers.
Working in hospitality may be a good option for those unsure about their career paths or with few qualifications because there are many job opportunities in this field.
This can negatively impact a business’s employee retention rate, as many of the skills required for hospitality roles are transferable from one establishment to another.
The employee may benefit from this arrangement if the restaurant meets their expectations; however, if the restaurant does not live up to the employee’s expectations, the employee may look for a better position at another establishment.
Many students choose to work in the sector part-time while studying at college or university.
Although some employees may want to leave once they have completed their studies, this should not be a major factor in low employee retention in the hospitality industry.
Many students take a part-time, seasonal role in hospitality during their studies – for example, over Christmas break or the summer holidays. This can be a great way to gain industry experience and earn extra money.
Staff Shortages and Brexit
The hospitality industry has been affected by some drastic changes in recent months, with both COVID-19 and Brexit causing significant impacts on employee retention and staff turnover rates.
The hospitality industry has seen fewer workers over the past year, with an estimated 10% of employees leaving. Reasons for this decline include ‘re-evaluating their work/life balance after lockdown’ and being reluctant to return to longer than 8-hour working days.
The impact of Brexit is still being felt across the hospitality sector. According to The Caterer, more than 92,000 EU workers are estimated to have left the industry. This has created a significant skills shortage expected to impact the sector going forward.
Staff Retention Strategies in the Hospitality Industry
When it comes to employee retention, you can do a few things to increase your rate.
Below are a few tips and strategies that may help keep your employees happy, feel valued, and want to stay in these. Every business is different, so tailor these tips to fit your company’s needs.
Establishing Expectations and Policies
It is important to be clear with prospective employees about what will be expected of them before they start working. For example, if a position requires working three out of four weekends, this should be stated explicitly.
There may be a need to work on weekends occasionally, but this should be made clear from the outset so that both parties know the expectations. This will help ensure that the employee is suitable for the role and help avoid any misunderstandings.
You may wish to consider introducing policies to help regulate employee hours.
For example, limiting the number of hours in each shift or the number of days employees work in a row. This may require extra time for scheduling but could improve employee productivity and satisfaction.
The long-term effects of this policy will be positive for your staff’s physical and mental well-being.
Effectively Communicating with Staff
As stated before, effective communication with your staff can have many benefits. There is no downside to having an “open-door” policy that encourages your staff to be honest about any issues or situations that may come up.
This could involve customers, other staff members, or questions about management.
This can help prevent a toxic work environment. It also means you’ll be better positioned to notice any negative changes among your staff. You can then act quickly to help prevent burnout.
Personal Development Plans (PDP)
One of the most common reasons for turnover in the hospitality industry is the perception that advancement opportunities are limited. However, this doesn’t have to be the case.
If you maintain clear and open communication channels with your staff, you can also gain insights into their aspirations and career ambitions.
Investing in your employees by coaching and mentoring them to help them reach their potential is important. Doing so will create a more positive work environment and increase the likelihood that they will stay with the company.
Recognizing and Valuing Staff
Employees who feel secure and supported in their roles are more productive. Valuing employees also contributes to a positive work environment and increased productivity.
There are a number of small and easy ways to achieve this. Taking the time to ask about people’s welfare, recognizing when they need a break, and challenging stereotypical or outdated behavior can help.
It is important to remember to reward your employees for a job well done. This can be done in many ways, such as buying them a gift or taking them out for a drink.
Thanking your staff for their hard work is a great way to show them that you appreciate their contribution to your business.
Creating a Positive Working Environment
It has been shown that being in a harmonious environment can have tremendous benefits for a person’s physical and mental health. A harmonious environment can help to reduce stress levels and has been linked with increased productivity. However, the evidence does not support this claim.
The key to creating and maintaining a respectful and supportive workplace culture is having a no-tolerance policy for workplace bullying or gossiping and promoting open communication to resolve conflicts before they escalate.
The workplace environment and culture have a direct impact on employee welfare. Creating a positive and supportive work environment will help to protect employee well-being.
This will improve their performance and reduce employee turnover in your hospitality business.
Offer competitive wages and benefits
In the hospitality industry, offering competitive wages and benefits for staff retention strategies is essential for the success of a business. These wages and benefits should be based on the local market rate to ensure employees feel valued and appreciated for their work.
Competitive wages and benefits can help reduce turnover rates, improve staff morale and loyalty, and increase employee productivity. Employers should also be flexible with their policies to accommodate staff needs and preferences.
Furthermore, employers should provide opportunities for development and career growth to incentivizing further employees to remain with the company. Providing competitive wages and benefits is a key strategy to retain employees within the hospitality industry.
