The Gig Economy: What Hoteliers Need to Know

By Dana Kravetz Firm Managing Partner, Michelman & Robinson, LLP | February 10, 2019

Call it what you will – the gig economy, sharing economy, freelance economy, on-demand economy, platform economy, [fill-in-the-blank] economy – the nuts and bolts of how we go about accessing people and services has changed dramatically in recent years. Want a ride? Grab an Uber. Hungry? DoorDash delivers. Need groceries? Instacart to the rescue. With just a couple of taps on a smart device, our every wish can seemingly be granted.

This genie-in-a-bottle approach to commerce extends beyond everyday consumers and into the corporate sphere as well, especially when it comes to staffing. Worldwide, an ever-growing force of independent workers available for short-term engagements is just a few clicks away. No doubt about it, the phenomenon most commonly referred to as the gig economy is shaking up "business as usual" across industries as technology transforms the manner in which companies – hotels and resorts included – fill vacant positions. And while this can certainly be a boon for hoteliers, the shifting employment paradigm is not without potential pitfalls.

The Modern Labor Pool

To best understand the rapid-fire expansion of the gig economy, it is important for hotel and resort management to be mindful of the playing field when it comes to labor. The numbers are compelling – Census Bureau data suggests that millennials will make up 75 percent of the workforce by 2025. Which begs the question: what is that generation looking for in a job? The answer is rather clear – flexibility and work-life balance, this according to a slew of reports, including relatively recent ones from MetLife and PwC.

For better or worse, millennials want choice when it comes to work, like when and where they do it, a conclusion only reinforced by Forbes reporting that reveals the majority of workers in the U.S. will be freelancing by 2027. The good news is that the gig economy enables and facilitates this independent and entrepreneurial trend line, something the hospitality space (restaurants in particular) is now harnessing for its own gain – and for good reason.

Leveraging a Flexible Workforce: The Pros for Hoteliers

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Eco-Friendly Practices: Corporate Social Responsibility

The hotel industry has undertaken a long-term effort to build more responsible and socially conscious businesses. What began with small efforts to reduce waste - such as paperless checkouts and refillable soap dispensers - has evolved into an international movement toward implementing sustainable development practices. In addition to establishing themselves as good corporate citizens, adopting eco-friendly practices is sound business for hotels. According to a recent report from Deloitte, 95% of business travelers believe the hotel industry should be undertaking “green” initiatives, and Millennials are twice as likely to support brands with strong management of environmental and social issues. Given these conclusions, hotels are continuing to innovate in the areas of environmental sustainability. For example, one leading hotel chain has designed special elevators that collect kinetic energy from the moving lift and in the process, they have reduced their energy consumption by 50%  over conventional elevators. Also, they installed an advanced air conditioning system which employs a magnetic mechanical system that makes them more energy efficient. Other hotels are installing Intelligent Building Systems which monitor and control temperatures in rooms, common areas and swimming pools, as well as ventilation and cold water systems. Some hotels are installing Electric Vehicle charging stations, planting rooftop gardens, implementing stringent recycling programs, and insisting on the use of biodegradable materials. Another trend is the creation of Green Teams within a hotel's operation that are tasked to implement earth-friendly practices and manage budgets for green projects. Some hotels have even gone so far as to curtail or eliminate room service, believing that keeping the kitchen open 24/7 isn't terribly sustainable. The May issue of the Hotel Business Review will document what some hotels are doing to integrate sustainable practices into their operations and how they are benefiting from them.