Tag: PrePandemic

Hotel Industry Years from Returning to Pre-Pandemic Levels

Irfan Peer Mohamed, director of food and beverage at the Argonaut Hotel in San Francisco, watched his staff shrink from 80 to about 10 during the early stages of the coronavirus pandemic.

He knew he would soon be unemployed, but he kept his team informed and prepared for being out of work as best he could.

“I wanted to make sure everybody would be okay,” Mohamed told Newsweek. “I knew it was going to be bad, and it’s been rough.”

coronavirus, Palau, hotels, covid-19
Palau Hotel in Palau is the oldest hotel in the country. It is currently closed due to lack of business.
Courtesy of Palau Hotel

A total of 7.653 million leisure and hospitality workers, or about 47% of the industry’s workforce, lost their jobs in April—the largest one-month net decline during the pandemic, the U.S. Bureau of Labor Statistics reported.

Mohamed was one of them.

Pete Hillan, spokesman for the California Hotel & Lodging Association, said there are about 6,000 hotels in the state employing an estimated 235,000 workers.
“The coronavirus pandemic has decimated travel and tourism throughout the state,” he told Newsweek. “The impact is going to be felt for years, and the industry won’t return to pre-pandemic levels until 2024.”

Hillan said the hotel industry follows guidelines established by the U.S. Centers for Disease Control and Prevention to limit the spread of COVID-19 to protect guests and staff. Nevertheless, occupancy rates remain low. Demand for conventions, business meetings, bar mitzvahs and weddings has collapsed as most leisure travel vanished.

And that means hard times for hotel employees.

“We’re now in the eighth month of the pandemic,” Hillan said. “Many employees are running out of benefits that help them survive.”

Hotel occupancy rates have recovered from record lows, but still remain well below average. Bookings on Oahu in the Hawaiian Islands were down 82.4% in September compared with a year ago, while occupancy in New York was off 77.5%, New York investment bank Goldman Sachs said in a research report.

Economy and mid-priced hotels have rebounded faster than other market sectors, but still remain significantly below average. High-end hotels recently reported a slight uptick, but remain near record lows, the New York investment bank said.

Construction of new rooms has all but stopped, and low occupancy rates force hotels to cut prices to compete for fewer business and leisure travelers, further straining profit.

The COVID-19 pandemic has whacked hotel stocks. Hyatt Hotels recently fetched $64.88 a share, down 31.69% from its 52-week high of $94.98. Marriott International recently changed hands at $115.26 a share, down 24.86% from its 52-week high of $153.39. At $12.41 a share, Extended Stay America is down 18.84% from its 52-week high of $15.29.

In New York, some hotels are providing temporary housing for the homeless as a stopgap measure to generate revenue. Residents of Manhattan’s posh Upper West Side objected when homeless people were lodged in the Lucerne Hotel. Similar objections were voiced in Brooklyn and other parts of the city where other

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