Labor Market Issues in the Hospitality and Tourism Industry

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In the hospitality and tourism industry, HR management involves different functions and tasks related to employees and their effective performance. The core and the most important field of HR is job analysis. Organizations cannot exist and function effectively without job analysis techniques and procedures. Job analysis is a concept and method for gathering job data, the basic data for HRM. It would seem obvious that the operations and activities of HRM can only be as effective and efficient as the quality of the data on which they are based.

Discussion Section

Human resource management

Labor markets data are designed to be qualitatively superior to data gathered by other methods. To consider this basic information in some depth, it has been organized into six areas. These areas derive directly from the expectations of the worker:

  1. a description of the opening and the workplace in which it occurs;
  2. the vision and mission of the organization and the goals that flow from its purpose;
  3. the functional performance levels needed to accomplish the outputs of the organization;
  4. the working conditions-physical, environmental, social, as well as effort, responsibility, and type of supervision in which the work will be done;
  5. the growth opportunities including training, educational support, promotion, and compensation;
  6. the accommodations the organization is prepared to make for disabilities, daycare, flextime, and the like (Abbott et al 2006).

In the hospitality and tourism industry, labor markets analysis is very important because it helps to describe and define the dimensions of the work activity being evaluated. Labor markets have a very comprehensive approach to this challenge. A job analysis describes the behaviors the workers indicate are necessary to produce the desired results. It opens up to the examination of the assumptions workers and managers have with regard to each other. The behaviors can be evaluated in terms of functional skill levels, orientation to knowledge resources, the performance standards workers seek to fulfill (their own and management’s), and the adaptations workers make to achieve those standards and overcome obstacles. The task analysis is the informational base. It represents the interaction of workers, work organization, and work to achieve productivity and contains within it the standards necessary to maintain a competitive advantage in the marketplace (Lucas, 20O4).

Industrial relations and labor markets

The hospitality and tourism market suffers from labor and skills shortages, and for this reason, foreign labor is the only long-term solution for the tourism and hospitality industry to survive (Lucas, 1995). For this reason, labor costs and skills have been, and remain, an important factor in its competitiveness in markets. Costs of capital and technology are controlled by forces other than the producers and, outside the country, markets and trade relations are dictated by international market and political forces.

HRM functions and policies

Among other dimensions featuring in this domain is the state of supply and demand for labor and the structure of employment. Critics admit that the nation getting older and foreign labor is the only long-term solution for the tourism and hospitality industry. Cumulative changes in the demand for labor and the structure of employment in the macroeconomic arena provide the basis for a transition that is brought about acutely by the contingency of the crisis in the macro-political arena, during which labor-importing states like the seize the opportunity to achieve the rationalization of the labor market they have already been hesitantly reaching for. Economic disparities between territories sending and receiving migrants include differences in earnings, livelihoods, and living standards (Kochan, 2004). The tourism and hospitality industry is already facing labor scarcity, an impact tacitly acknowledged by the authorities. With the changing economic environment, such factors as an imbalance between supply and demand mark the industry (Lucas, 20O4).

Contemporary trends

In terms of contemporary trends in HRM, free movement of labor will help the tourism and hospitality industry to overcome labor shortages and ensure the supply of foreign workers. Economically, socially and financially, foreign labor will help the industry to respond to buyer needs and improve its performance. In recent years, the remarkable feature of the tourism and hospitality industry is a great imbalance between supply and demand. The basis for advantage is the fact that the industry can stay ahead of the market when firms are more sensitive to and more responsive to demand, and when supply, in turn, reflects or anticipates demand. Socially and economically, foreign labor will become a burden for both tourism and hospitality companies and the government (Kochan, 2004).

In the hospitality industry, the demand sets the quality standard and gives firms a better picture of buyer needs at an earlier time than is available to rivals. In contrast to UK workers, foreign labor allows the tourism and hospitality industry to save money on wages and public health services, so reducing the cost of tourism and hospitality. Also, foreign labor allows tourism and hospitality companies to increase their building activities around the country. When presented with the opportunity, or by creating opportunities themselves, the tourism and hospitality industry opts to maintain total labor costs at a minimal level. Only cheap labor will help the tourism and hospitality industry to improve its market position and compete with foreign tourism and hospitality companies. Foreign labor will help to supply cheaper buildings and saturate the market with low-cost services and products. Cheap (foreign) labor will help the tourism and hospitality industry to invest in innovative technologies and new tourism and hospitality material (Harper and Vilkinas, 2005).

Diversity management

Foreign labor is the only long-term solution for the tourism and hospitality industry because it will help to replace workers unwilling to work in low-prestigious professions. The industry will benefit financially and will be able to innovate and invest in new methods and technologies. It intends to maximize profits and minimize losses; labor cost is where they found the greatest point of leverage. The main tendency for the future is rapid market growth, so cheap foreign labor will help the tourism and hospitality industry to overcome skills shortage and invest in human resources and tourism and hospitality facilities (Christensen Hughes, 2008).

Labor markets are closely connected with recruiting and selection processes. It is possible to say that recruiting and selection are based on job analysis data. Recruitment materials should clearly demonstrate the extent to which management has gone, and is willing to go, to accommodate employees. A description of such accommodations as flextime, cafeteria-style benefits, daycare, and work aids may encourage persons with special needs to apply. For some job seekers (e.g., women with small children, workers with physical limitations), information about accommodations contained in or missing from recruiting materials will have a major impact on their self-selection and whether or not they pursue the job search with an organization (Brownell and Walsh 2008).

Effective occupational HRM that results in qualified applicants who have self-selected to become employees of a particular organization, depends on a fair exchange of information about both job content and job context. Employers need to share with prospective workers both the advantages and disadvantages of employment in their organization (Bratton and Gold 2007). This includes providing information about:

  1. the job opportunity and the workplace setting in which it occurs;
  2. the vision and mission of the organization;
  3. the functional performance levels needed to accomplish the outputs;
  4. the working conditions: effort, responsibility, environment;
  5. growth opportunities: educational support, promotions, compensation;
  6. accommodations the employer makes to meet special needs.

This information can be provided by brochure, interview, video, or some combination of these modalities. It can be disseminated by advertisement (in a limited way), through outreach as in job fairs at schools, and through it administered in the offices of the organization. This open and forthcoming approach at the first meeting lays a foundation for trust that becomes a vital element in future productivity (Boella and Goss-Turner, 2005).

Hospitality management makes the right decisions about who to hire more often than not when an applicant screening system is effective. Management makes these correct decisions by hiring people who perform up to or exceed expectations (correct hires) and rejecting those applicants who would have been less than satisfactory performers on the job. Although management would prefer to be 100% accurate in these predictions such omniscience is impossible. Conversely, management can make two types of wrong decisions when hiring from a group of applicants. The first mistake is to hire someone who performs below expectations on the job. These people are the incorrect hires. Failure to hire people who would have been satisfactory performers but never got the chance to show their stuff is the second mistake. These people are the incorrect nonhires. Managers are sensitive to the first type of hiring mistake because an individual performing below expectation must be retrained or terminated. Hiring mistakes of this kind cause expense and inconvenience to the organization and are highly visible (Alleyne et al 2006).

Occupational health and safety

During occupational health and safety procedure, people want to know whether they are doing their part, getting their assigned job done, and meeting the objectives of the organization. They need to know this in order to maintain their self-esteem and integrity among their fellow workers. Management also needs to know this in order to determine whether it is communicating its objectives correctly and effectively, whether it is providing the necessary training to achieve those objectives, and to identify outstanding work for special rewards bonuses, transfers, promotions. For both the worker and the organization, a performance evaluation takes stock and provides a breather from which to go on with revitalized energy (Baum, 2006).

Employment laws can only faintly reflect the richness and meaning in any work experience, although labor markets come closer than many job analysis methods by working within the experience of incumbents and writing the task bank in their language. As a worker makes sense of the work and grows in the work situation, he or she modifies the work in ways both large and small to suit personal style and growth needs and to make the work-doing system more productive most often without the awareness of management. To expect workers to do any less is to deny their need to express their sense of self and their competency. Unfortunately, worker efforts to improve the workplace often go unrecognized and unappreciated by management. Even worse, management frequently censures workers when they redesign their work in ways management has not foreseen. This is not to say that managers should not be involved in job design. Managers who leave workers entirely to their own devices abdicate their responsibility to add value to job design value contributed through the synergy of joint problem solving. Without this mutuality, workers’ job design efforts, however well intentioned, sometimes come off as improvised, especially because need for cooperative effort in job design has been known for a long time.


Hospitality and tourism managers have perspective on the goals and purpose of the work-doing system (the big picture). They should clearly articulate the objectives and goals for the work unit or team and inform workers of systems factors that can impede or facilitate the workers’ efforts that need to be accounted for in job redesign. For example, if an old machine is to be phased out in a few months and replaced with a new one having up-to-date technology, the manager needs to inform the workers of the upcoming replacement before they undertake extensive work to modify the old machine (Baum, 2006). Hospitality managers also need to provide technical or other data that can contribute to more effective job design; for example, engineering specifications, designs, and advice may be very helpful to workers making modifications to increase the production of a machine. Additionally, management should give workers access to the vital resources, including money, required to effect the improvements; for example, an anticipated work redesign may require a training program to familiarize workers with a new technology. Finally, management should provide support and encouragement when workers willingly take on self-initiated job design. In short, the manager is the catalyst for job design. A catalyst provokes change, induces the system to move to a place where it would not otherwise go, but the energy driving the reaction is provided by the workers.


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Alleyne, P., Doherty, L., Greenidge, D. 2006. Approaches to HRM in the Barbados hotel industry. International Joumal of Contemporary Hospitality Management. Vol. 18, lss. 2, p. 94.

Baum, T. 2006. Human Resource Management for. Tourism, Hospitality and Leisure, Thomson. Learning, London

Boella, MJ & Goss-Turner, S 2005, Human resource management in the hospitality industry : an introductory guide, 8th edn, Elsevier Butterworth-Heinemann, Amsterdam ; Oxford.

Brownell, J and Walsh, K 2008 ‘Women in Hospitality’, SAGE Handbook of Hospitality Management, SAGE London, 107 – 128.

Christensen Hughes, J 2008 ‘Human Resource Management in the Hospitality industry’, SAGE Handbook of Hospitality Management, SAGE London , 273 – 301.

Harper, S & Vilkinas, T 2005, ‘Determining the impact of an organisation’s performance management system’, Asia Pacific Joumal of Human Resources, vol. 43, no. 1, pp. 76-97.

Kochan, TA 2004, ‘Restoring Trust in the Human Resource Management Profession’, Asia Pacific Journal of HumanResources, vol.42, no.2, pp. 13246.

Lucas, R 1995, Managing employee relations in the hotel and catering industry, Cassell, New York.

Lucas, R 2004, Employment relations in the hospitality and tourism industies, Routledge studies in employment relations, Routledge, London ; New York. Library.

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