Staff retention in hospitality: More work needed to reduce turnover rates says People 1st

21-Mar-2013 - Last updated on 26-Apr-2021 at 18:10 GMT

People 1st's fourth State of the Nation report shows that more people are being trained, but that retention levels in hospitality are still low compared to other industries

Restaurant, hotel and pub owners will need to continue to train and develop their staff if they want to improve retention levels, says sector skills council People 1st with the release of its fourth State of the Nation report.

The report, which examines skills and labour trends across the industry, found that although staff turnover rates at the 2,000 hospitality businesses questioned had fallen 11 per cent in the last three years, there was still some way to go to improve levels as 21 per cent of hospitality companies had reported skills gaps compared to the overall business average of 13 per cent.

People 1st chief executive Brian Wisdom warned the industry it would face 'significant pressure' in the future to find the estimated 660,200 extra staff by 2020 if companies failed to invest in staff at management level.

“Our employers are already saying that many of their staff lack the necessary customer service and management and leadership skills, so as the need for these particular skills grows, the situation could definitely get a lot worse.

“A lot of effort has gone into attracting people into the industry, but this shows that what we really need to do is place much more emphasis on making sure that the staff we already have in the industry are retained and given the training they need.

“As the economy picks up and we face recruitment competition from other industries, ensuring our staff have the right skills is going to be hugely important.”

Influence on hospitality

With employers showing a general optimism about the future, the report also gave insight into areas that will influence the sector in coming years, noting that 88 percent of employers believed customer service skills would grow in importance in the next three to five years.

The areas where employers believe they will need to focus on most in the next few years were management and leadership skills (69 per cent), the need to address sustainability issues (58 per cent) and effective use of social media (48 per cent) as more customers use this medium to find out what businesses and deals are in the market place.

Wisdom said businesses would also be wise to focus on providing the right training for staff in the future.

“Our research found that only 41 percent of organisations offered training in the past 12 months, which means that there are a lot of people missing out,” said Brian.

“Of those that do offer training, most money is directed toward elementary occupations, which is carried out at the most basic level, and much of this is because of the high turnover rates we’re experiencing. It has become a vicious cycle that we need to stop.

“If only 36 percent of organisations provide training directed at addressing individual needs, we are not doing enough to develop the skills we need – either now or in the future.”

Key facts from the State of the Nation 2013 report:

One in 14 people working in the UK are employed in the hospitality and tourism sector.
There are 181,500 individual business sites operating in hospitality and tourism with restaurants, hotels, pubs, bars and nightclubs making up 70 per cent of the sector.
Employment growth in the hospitality and tourism sector (0.7 percent) is higher than the average for the economy as a whole (0.5 percent).
Hospitality and tourism contributed £40.6bn to the UK economy in 2011.
Forty-six per cent of hospitality and tourism businesses employ less than five people.
The majority of skills shortage vacancies are for elementary staff (43 per cent) and skilled trade occupations (41 per cent).
The sector spends an average of £3,625 per person on training (the average across all industries is £3,275).

The full State of the Nation 2013 report can be found here.