A British Hospitality Association survey of its members revealed staff costs have increased in some hotels by over 10%.
Nearly one-third of hotels said their wage bill increased between 3%-6% in the last four months, 22% reported a 6%-10% increase and 13% said their increases were over 10%, compared to the same period last year.
A BHA spokesman said the cause of increases is threefold; a short supply of skilled staff causing hotels to pay more to secure them, hotels budgeting for the upcoming national minimum wage increases in October and, lastly, the cost incurred by hotels that stayed open over the millennium holiday. A Whitbread spokesman said the majority of its staff are paid higher than the minimum wage already and any increases in staff costs will have been planned.
Thistle director of human resources Mark Geary said: “We expected the minimum wage would increase so we budgeted accordingly.”
Despite the impact of the national minimum wage and other employment legislation, 23% of hotels said they contained increases in staff costs to under 3% by shortening shifts to improve efficiency and productivity. A further 10% of hotels said they had managed to reduce payroll costs.
The BHA survey, to be conducted every four months, aims to monitor business confidence and highlight emerging trends in the hotel industry. The latest survey showed 52% of the respondents forecast an overall increase in sales and 42% expect occupancies to rise.
Over half the respondents reported better trading in the past four month period over the same period last year.
Some 53% reported an increase in their average room rate. Only 22 % reported a decline in trading and 15% reported a decline in average room rates.
Eight out of 10 members said their top challenge is making sure their business grows. Payroll costs and staff recruitment difficulties are the next biggest concerns.
BHA chief executive Bob Cotton said: “This is a snapshot of the hotel industry. It shows where hoteliers have confidence and concerns.”