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When even the GM has to play chambermaid

Serious hotel worker shortage; hoteliers say caps, levies on foreign staff make it worse. -BT
Nisha Ramchandani

Wed, Jan 23, 2013
The Business Times

SINGAPORE - Singapore's hotel industry - which has been running high occupancies at record-breaking room rates - is finding itself the victim of its own success.

While hotels have chalked up significant growth since the 2009 financial crisis, securing enough staff to run operations in today's tight labour market is easier said than done.

Shrinking foreign worker quotas compound the problem of sourcing staff for less popular departments such as housekeeping, while the challenge of hiring enough Singaporeans can make it tough to stay under the dependency ratio ceiling (DRC). Higher foreign worker levies add to costs, which can take a bite out of profits if not properly managed.

With service being the backbone of the industry, the impact of the legislation is "very painful", in the words of Royal Plaza on Scotts general manager Patrick Fiat.

Being stretched for staff means it takes longer for the hotel to tend to guests when they check in or at its food and beverage (F&B) outlets, which understandably does not go down well.

This is exacerbated when the hotel hits occupancies in the region of 90 per cent (its housekeeping department has enough staff to cater for 75 per cent), which means employees have to work overtime.

Staff from other departments may also be called in from time to time to help with rooms - Mr Fiat himself being no exception. "It's not easy to change a (bed). Very complicated," he confided in French-accented English.

Meanwhile, the cost of the hotel's foreign worker levies has risen from $35,000 three years ago to $60,000 today.

In the first half of 2012, the industry-wide average room rate hit a new high of $260, while the average occupancy worked out to a robust 86 per cent, delivering a record revenue per available room (RevPar) of $224. 2H12 data has yet to be released but Cushman & Wakefield expects full-year occupancy for 2012 to come in at 88 per cent and the average daily rate at US$207 (S$254).

While not all hotels are understaffed, one of the often-sung refrains is that hoteliers are having problems filling certain jobs, especially when it comes to locals.

"Singaporeans are not keen on F&B jobs (and) front-desk jobs that require them to work longer hours and irregular shifts. The option to hire is always open if Singaporeans were to apply for the job," highlighted Kellvin Ong, general manager of the Rendezvous Grand Hotel.

Orchard Hotel's general manager Andrew Tan said that with Singaporeans not filling open positions fast enough, this tended to impact its foreign worker dependency ratio significantly, leaving it with no or negative quota.

The 511-room Royal Plaza currently has a staff strength of nearly 380 - but needs closer to 405. About 60 per cent of its staff are local. "We still want to hire. We put ads in the newspaper - no one shows up," said Mr Fiat, adding that it conducts roadshows in Malaysia as well, where response has grown poorer as new hotel properties are launched.

Remuneration in the big cities such as Kuala Lumpur works out comparable to Singapore when the city-state's substantial housing and transport costs are factored in.

The tangible impact of the employment changes may also be less cut-and- dried here compared to other industries such as manufacturing, where companies can scale back expansion or relocate their operations.

"It is an indirect impact on revenue and profit as, due to the lack of manpower, we might not be able to provide (the) service that our guests have come to expect. If they are disappointed, we lose a customer," said Mr Ong.

But now that push has become a decidedly less gentle shove and the likelihood of a U-turn in policy appears slim, hotels are making an effort to boost productivity, redefine job scope and fine-tune operational processes (albeit with a little grumbling along the way).

According to the Singapore Tourism Board (STB), some hotels are adopting different business models to cope with the tight labour market, either scaling back F&B components or doing away with them altogether.

The Pan Pacific Singapore reopened last September after an $80 million renovation. Among the productivity initiatives implemented were enhancing the check-in process so guests can do so via an iPad while being walked to their room.

The Four Seasons' crunch team - made up of employees across various departments such as finance and human resource - is serving it well today. Alerted by text message, the team swoops in to help out with simple tasks when certain departments are overwhelmed. Meanwhile, the hotel's investment in a state-of-the-art dishwashing machine (which does the work of two employees) allows the kitchen staff in question to be deployed elsewhere.

Improving the work environment so that the turnover rate is kept to a minimum is another strategy that hotels are employing. The Rendezvous Grand is doing its best to retain older workers, while using technology such as motorised trolleys to help them in their work. Certain job operations may be outsourced, such as security, banquet and some components of housekeeping. But the hotel has to ensure quality standards are maintained when a third party is brought in, Mr Ong said.

At the Pan Pacific Group's new Parkroyal on Pickering hotel, staff are trained in multiple job roles, with clear career progression charted out as employees hone their skills. This will be rolled out in some of the group's other hotels too.

Recently, the Job Flexibility for Productivity scheme was piloted by the Ministry of Manpower and STB, allowing a hotel to offer employees the opportunity to be deployed across different job functions within the hotel.

"We hope it will help boost productivity and translate to higher wages for workers performing multiple roles," an STB spokesman said.

Some hotels that BT spoke to said that the added flexibility could help. But Orchard Hotel suggests that the scheme may not be a fix-all. "When the hotel is running full-house or at its peak periods, all operations departments would be affected and it would be difficult for any of them to spare manpower. Also, many staff are already physically stretched," Mr Tan said.

The Pan Pacific Group is also looking at flexible rostering and hiring older workers as well as those who may have been out of the workforce for a while such as housewives.

But not every good idea is a home run. For instance, the group tried to hire a third party to help out with cleaning - but the agency in question couldn't find enough staff either.

"The world has changed," said Pan Pacific chief executive Patrick Imbardelli. "We keep on trying things but you've got to do that now."

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