By Dr. Greg Barnett, SVP of Science at The Predictive Index

The hospitality industry has experienced significant growth, with 1.1 trillion spent on travel expenses last year. As more Americans use their discretionary income to travel, the need for skilled workers has only increased to meet demand. In fact, the unemployment rate in the industry swelled to 1,139,000 in 2018. Pairing this with today’s emphasis on the experience-based economy, it’s easy to see how critical it is for the industry to act quickly to fill open positions and ultimately meet consumer expectations.

While increased travel is a positive trend for the industry, it has left industry leaders in the unique position of having to improve customer experience to stay competitive while also tackling the resulting talent shortage. To meet the talent challenges of today, hospitality companies must reinvest in the employee experience starting with the development of a sound people strategy. In fact, according to a recent employee engagement survey, the number one driver of engagement in the hospitality industry pertains to the job category, as opposed to other critical drivers of engagement like the organization, people you work with, and manager. In essence, employees that are the most engaged must feel excited by the work they do every day. Therefore, the hospitality industry must deliver an exceptional employee experience in an industry often known for seasonal work, low growth potential and poor work/life balance.

Here are three steps leaders in the hospitality industry can take to improve employee engagement and bolster retention:

  • Hire for behavior, train for skills: According to Compensation Force, employee turnover rates in the hospitality industry are significantly higher than the national average with 28.6% of employees leaving their jobs compared to 17.8% across all other industries. One way the hospitality industry can combat this high turnover rate is by adjusting recruitment practices to hire for behavioral and cognitive fit. Hiring managers often overlook candidates who don’t have experiences that perfectly match the role they’re looking to fill – resulting in a revolving door of talent. Instead, hospitality companies should focus on hiring based on behavioral and cognitive fitness which ensures that the candidate is wired to do the job while also having the capacity to learn the necessary “technical” skills quickly. For example, when evaluating a candidate, hiring managers shouldn’t just look for prior experience. Instead, they should identify qualities that may make the candidate collaborative, supportive of their team members and proactive. In addition, reevaluating existing talent through a talent optimization lens will allow leaders to identify strengths and weaknesses for each employee and place them in the right roles. Through tools like behavioral and cognitive assessments, hospitality companies can collect the necessary people data to elevate engagement, ultimately growing productivity and developing more naturally aligned teams.


  • Invest in people: Hospitality companies boasting the highest employee retention and engagement rates are those that care about their employees. Companies that strive to provide a phenomenal employee experience end up outperforming their competitors, are better at retaining top talent and ultimately boost productivity which leads to increased profits. A sure way to boost engagement is through implementing programs that show employees they are important and appreciated. Continuing education programs, paid family leave and competitive vacation packages are all ways to make employees feel valued in and outside of the workplace. In addition, offering competitive compensation rates, continued training and career growth opportunities across the company will make employees feel their organization is invested in their success.


  • Create a culture of engaged employees: A strong, intentional and well-communicated organizational culture is the foundation of all great companies, and exactly what sets them apart from competitors. When members of leadership in hospitality companies manifest the values and missions they espouse for their employees to demonstrate, the benefits reach talent at every level. Culture is what attracts candidates to apply to a job and what entices them to sign on the dotted line once an offer is made. While screening candidates for culture fit is something that should always happen during the hiring process, the reality is that it rarely does. When employees are aligned with their company culture, they work extra hard to help the company reach its strategic goals and propel the company to outperform the competition. Research shows that teamwork drives workplace performance. While culture adjustments can be met with skepticism, true culture-building actually fosters connection and collaboration amongst co-workers.

Ultimately these strategies boil down to three key themes: reducing the number of open positions, employee engagement, and culture. By properly diagnosing the situation with a talent optimization approach, a clear action plan can develop that will be ready to implement. While closing the talent gap is not within one person’s control, implementing these strategies throughout the organization will help foster a more engaged and fulfilled team and in turn lead to more positive business outcomes.