Markets in Focus
Hotels + Resorts + Casinos
Markets in Focus | Hospitality | HRC Q4 2021
Since few industries were as severely impacted by COVID-19 as the travel and leisure sectors, many industry commentators thought it would take years for hotels and casinos to return to pre-pandemic levels. However, both industries have shown incredible resilience and reached January 2020 levels of occupancy, rates and revenue in July of 2021 (as can be seen in the chart on the next page). Despite the challenges, hotel and casino operators were able to evolve their businesses to safely attract guests and thus improve their economic positions as pent-up leisure travel demand had a positive impact on their bottom line.
As hotels and casinos look to capitalize on the momentum experienced in Q2 and Q3 of 2021, operators will have to face new and old challenges moving into 2022. Stricter COVID-19 protocols and travel restrictions are starting to enter the fray again as concerns over new variants like Omicron have swept across the world. Once again, hotel and casino operators will need to stay diligent with everchanging regulations regarding masks, additional cleaning and disinfection of shared surfaces, food and drink serving requirements, vaccination status (both of guests and employees), social distancing and occupancy requirements. Additionally, as more countries impose travel bans, revenue may have to be supported only by domestic travelers for the foreseeable future.
Additionally, like many other industries, hotels and casinos are struggling to retain and attract talent. Many workers in the hospitality space were let go during the pandemic and are hesitant to return, especially considering that new variants continue to surface and impact the demand for the hospitality trade. This has resulted in understaffing, with fewer employees doing more and inevitable concerns over customer satisfaction. These factors have led to burnout and fatigue for the employees still working at hotels and casinos, resulting in many quitting and contributing to the global phenomenon known as the Great Resignation. To combat this, many hotels are no longer offering daily room cleaning, casinos are looking to invest more in sports betting and online gambling, and both are looking for answers in process automation. Some establishments are taking even more interesting approaches like MGM, by allowing potential employees to ”work” jobs in Virtual Reality before signing on.¹ As 2021 comes to a close and hotel and casino operators look to plan for 2022, innovation and creativity will need to be at the forefront to attract customers and talent, as it appears 2022 will be another year of anything but “business as usual.”