Long awaited relief for Australia’s hospitality sector as job shortages begin to ease

A bounce-back in international visitor arrivals and a relaxation in visa rules are already providing some relief for the Australian hotel industry as job vacancies begin to ease.

New CBRE research has highlighted that while the busy Christmas holiday season is still expected to create some headaches for owners, an uptick in arrivals has corresponded with a decline in the Hospitality Job Advertisement Index, which fell by 60% in the three months to July 2022.  

While there were still more than 34,000 hospitality related vacancies across Australia in July - more than double the ads recorded three years earlier - the positive trajectory of the job index signals signs of a turnaround according to Troy Craig, Regional Director of CBRE Hotel Valuation & Advisory Services.

“While the decline in the index has occurred amid inflationary cost pressures and interest rate rises, which may lessen the propensity of businesses to increase wage costs, the overall trend is encouraging,” Mr Craig said.

“A continued rise in international arrivals is expected to bring more desirable conditions for hospitality employment and we expect to see the significant imbalance between worker availability and demand to be largely overcome by mid-2023. 

“This is being buoyed by the return of student and working holiday visa holders, aided by recommendations from the Federal Government’s Jobs and Skills Summit to extend visas and relax work restrictions on international students to help solve the industry’s critical jobs shortage.”

The extent of the jobs shortage was recently highlighted when Crown Resorts reported 2,000 job openings from a total workforce of 20,000. 

Industry-wide, shortages have been highest among cleaners/laundry workers and food prep assistants, with vacancies up 235% and 160% respectively from pre-pandemic rates according to CBRE’s report.

CBRE’s Head of Hotels Research Ally McDade noted that COVID-19 and international border closures had fuelled the worker shortage.

“Prior to the onset of the pandemic, 23% of temporary workers, 68% of international students and 38% of all working holiday makers were employed in hospitality related roles,” Ms McDade said.

“Pandemic related lock downs also saw rolling closures of most hospitality venues, resulting in many workers leaving the sector in favour of less affected sectors of the employment market.”

Ms McDade said the critical problem Australia faced was competition with developed countries around the world for the same skills and capabilities.

“Australia has not been a destination of choice because of travel times, the cost of living and the fact that most visa opportunities are short-term,” Ms McDade said.

“The hope is that policies adopted from the Federal Government’s Jobs and Skills Summit will support turning this around by increasing the skilled labour cap and providing extra resources to reduce visa processing times.”

Ms McDade said many operators were also thinking outside the box to shore up their supply of workers for the festive season.

This included Australian Venue Co. offering $1,000 F&B vouchers and a $1,000 referral bonus to help fill 2,500 positions to cater for long lead function bookings.

“We also expect to see a more widespread implementation of contactless ordering, allowing for fewer staff to meet customer demands,” Ms McDade said.