In this series, we speak with four professionals about their views on the global labor shortage in hospitality, the challenges they are facing, and how they are coping and adapting. Our four interviewees span the industry with diverse experience and backgrounds: Gefferson Alves, Managing Director at Ba’ra Hotel Joao Pessoa; Stephen Burke, Founder of Robosize Me; Rosanna Maietta, EVP Communications & PR at the American Hotel & Lodging Association (AHLA), and Danica Smith, Director of Product Engagement at Shiji Group. You can read our first conversation with Danica here. Today we take a trip to Brazil to chat with Gefferson Alves, Managing Director of Ba’ra Hotel in Joao Pessoa, Paraiba, Brazil.
Gefferson Alves is a believer in working with people and for people. He is also the Managing Director of Ba’ra Hotel Joao Pessoa, a hotel due to open in October overlooking the Cabo Branco Beach in Joao Pessoa, the capital of the Brazilian state of Paraiba. With hotel management experience exceeding 23 years, his motto is “Think like an owner, act like an entrepreneur, and put teams and guests first”. In this article, he shares his position on the labor crisis.
A Familiar Issue
For Gefferson Alves, the labor shortage currently permeating the industry isn’t a new problem at all. Rather, it is something hoteliers have always had to deal with, but has been exacerbated in the aftermath of the pandemic. The current landscape was already true in the past, and the only difference is that, now, it is more obvious than ever that it must be properly addressed.
From his experience working in different locations across the globe, Gefferson always saw a common pattern. “In our market, specifically in Brazil, the Hospitality Industry’s pay is subpar when compared to other industries, but I also see this happening in other countries as well.” He also notices how commonplace it is for hotels to ignore the voices of their staff, which stems perhaps from decisions always being made at a corporate level and without input from those at the property, who would be most affected by them. He sees an excessive amount of importance placed on short-term profit over the satisfaction and wellbeing of the employees. According to Gefferson, 80% of hotels in Brazil have owners that are either management companies or investors interested in short-time returns, putting the day-to-day operations of the hotel on the backburner. Some family-owned hotels are more caring of their staff and able to achieve better results, but they still lack the scale larger chains benefit from in terms of ability to provide benefits.
All this effort meant a closer relationship with the team, which has translated to a whopping climb from number 59 to number 2 on TripAdvisor’s ranking for that city that has lasted over two years.
After the pandemic, the labor shortage in Brazil worsened, as it did in most parts of the world. The exodus of talent, both voluntary and prompted by external conditions, was further complicated by their unwillingness to return to the industry due to tougher work conditions as hotels were unable to be staffed at the same levels as before. It is the familiar cycle that just kept getting worse.
Long Term Focus
The solution, in Gefferson’s view, begins with management putting themselves in their employees’ shoes to better understand what they are facing and then working with owners in order to reach a balance between business returns and employee satisfaction. “First of all, you listen to what your employees want. Once you’ve listened, you can make your decisions with them and that’s the most important part. It’s a very basic concept, but not so commonly put into practice”, Gefferson observes.
In his opinion, compassion is extremely important, above all in the current scenario where the pandemic has changed the reality of so many. Being mindful of an associate’s family situation, such as whether they are coping with the loss of loved ones or have become the sole breadwinner is a start. Staff need to know employers are close to them in both words and actions. They need to be shown support and that can come in different shapes and forms.
Having good benefits and treating people with dignity is only the bare minimum hoteliers can do if we wish to reduce attrition and have long-lasting relationships. Gefferson argues that “If the compensation isn’t enough for a decent living, how can employees be expected to give their best in a job that doesn’t even pay them fairly? This is something that I’m really fighting for in order to provide staff with the minimum conditions to live well.”
At his previous property, Gefferson has convinced owners that the way to achieve the best results is to have well-trained and motivated staff who feel they are treated respectfully. To that end, the company offered good health insurance, counseling support for employees and their families, food aid in the form of basic food kits distributed frequently to employees, and great staff meals on-site, in addition to salaries 20% above the market average. All this effort meant a closer relationship with the team, which has translated to a whopping climb from number 59 to number 2 on TripAdvisor’s ranking for that city that has lasted over two years.
“Let’s treat people the way they should be treated, let’s pay them more not because we have to, but because we want to, and because we want to keep our business alive not only for the next five or ten years, but for the next twenty.” Gefferson Alves
The next step after taking care of staff’s basic needs was to provide more self-actualizing benefits, such as spaces for leisure and relaxation, internal and external training and schooling opportunities, and partnerships with gyms and other stores for employee discounts. For leadership, providing assistance in their development with support for further education or language courses showed an interest in their career progression and created increasingly capable leaders.
Such a comprehensive benefits program can sound costly or impracticable to most but can be achieved with close collaboration with owners and good planning. Gefferson advocates for heavier investment in staff in exchange for a slightly reduced GOP. There may be a 10% decrease in profits, says Gefferson, but treating people well makes the business more viable and profitable in the long run. It’s a marathon rather than a sprint: “Let’s treat people the way they should be treated, let’s pay them more not because we have to, but because we want to, and because we want to keep our business alive not only for the next five or ten years, but for the next twenty.”
Ongoing Efforts to Improve the Labor Shortage
With the restructuring and constant focus on internal stakeholders, Gefferson’s efforts have generated loyal staff and steady business, but he believes there are always improvements to be made and suggests that hoteliers always keep informed and watch best practices put in place by colleagues around the world.
Recognizing that hotels do not operate in a bubble and are dependent on local communities even in the most heavily tourist-reliant destinations, he is turning some of his attention to the locals and trying to prove to the city that an average room rate raise is necessary to be able to continue investing in various programs, not on the property, but also in the neighborhood and city, to show that the destination as a whole can be in a better position.
The initiatives include giving back to the community with programs to improve local literacy rates in the native Portuguese language, as well as in Spanish and English – which are of crucial importance at a world-famous tourist destination like Joao Pessoa – and computer literacy lessons.
Staff training and development will always need attention, and the current return to business after an almost three-year low does pose some challenges. A near-constant occupancy rate of 80% means less time to train all the staff. Breaking the vicious circle of high churn rates allows hotels to retain more staff, which means more time to invest in each team member as the workload is not resting solely on a few overworked employees.
The key to solving the labor shortage is to keep a hands-on approach to operations, with an ear to the ground at all times. Staff who are treated well will treat guests well, and to Gefferson, there are no shortcuts to achieve this. “We can’t have happy guests if the staff aren’t happy with their jobs, and our job as hoteliers is to provide them with support and opportunity. That’s 50% of the way.” He proposes that we should take care of our staff and guests, all while making informed decisions and still keeping an eye on the GOP and the business continuity.
Stay tuned for our next conversation on the hospitality labor shortage next week.