Are labour shortages set to damage your business? In January the WTTC (World Travel and Tourism Council) and Oxford Economics, released a report showing a shortfall of UK travel, tourism and hospitality jobs of over 200,000. That means one in eight jobs remaining unfilled.
WTTC CEO Julia Simpson, commented;
“If we cannot fill these vacancies, it could threaten the survival of Travel & Tourism businesses up and down the UK. Companies’ dependent on tourism have been hanging on for the upside, this is just another blow that many may not survive”.
The UK is not alone, with similar trends are being seen across other European countries. One inevitable consequence are equivalent rises in pay. Already by June 2021 City AM were reporting of wage rises in the sector of up to 14% simply to retain staff. The problem is that we are in competition with other sectors, who are also responding. Only in December, London department store Harrods averted a threatened strike by awarding its staff a 25% pay rise.
So how can your business respond?
To quote former Harvard University President Derek Bok, “If you think education is expensive, try ignorance.” So in this piece I concentrate on how leaders can find a return on investment from skills development. Yes, tourism businesses are cash strapped post the pandemic. Nevertheless upskilling drives positive outcomes in two key areas:
1. People engagement, both to retain & motivate existing staff, plus to attract fresh talent
2. If salaries are increasing, how can you achieve enhanced productivity to pay for them?
With every sector competing for limited talent, the travel & hospitality sector is being left behind. What is more this looks set to be a long term trend. Inequalities in income that have been growing since the 1980’s, may now go into reverse, as demonstrated by the UK government’s “levelling-up” agenda.
Furthermore, another shift is underway, where practical and caring skills, which have been undervalued for years, are now being re-calibrated positively against a surfeit of “knowledge based” qualifications. Embedding personal and professional development into a company’s DNA will be critical to addressing the challenges highlighted above.
And what a problem this is proving to be. A PWC report from January 2022 found that 80% of CEO’s saw successful upskilling as their greatest business challenge. So if a strong case exists for making an investment, how do you make sure it is worth the time and money? The UK Commission for Employment & Skills (UKCES) found that British employers invested a total of £42 billion in training, an equivalent of £1,500 per employee.
Unfortunately it also found that precious few organisations had successfully maximised the return on this investment. Business people will always want to generate the maximum possible benefit for a minimum cost.
So here are 7 tips to bear in mind in formulating a successful skills programme:
1. Set clear objectives: what does your business need in terms of knowledge, skills and behaviours? Give careful thought to current shortfalls and what “good outcomes may look like” in the future. Seek outside opinions to double check your assumptions. 2. Secure employee buy-in: there is nothing worse than your staff dragging their feet to a training session, wondering why they need to attend. Experts believe that in the economy of the future, retooling will be required every 6 months. Awaken their sense of responsibility that your investment will positively benefit their future careers. Moreover strive to maintain ongoing engagement. Building strong resilient careers, also builds a strong, healthy business.
3. Capture institutional expertise: we all know of the “grey hairs” in our business who have accumulated decades of knowledge… but this all remains in their head. Look for ways to leverage and broadcast this expertise.
4. Create the right environment: whether in person or on-line, make sure your people are able to focus on the learning and not be distracted by outside pressures of work or their daily lives.
5. Utilise best-in-class technology: High value sectors like telecoms & pharmaceuticals increasingly leverage “ed-tech”, where the gold-standard is “LXP” systems (Learning experience platforms). These are engineered to optimise user engagement through course structure and techniques like gamification, They also gather invaluable trainee data for driving smart decision making. Moreover costs are reducing all the time, putting them within the reach of cash-strapped tourism companies.
6. Take advantage of funding: In the UK the government will finance up to 90% of apprenticeship training costs https://www.gov.uk/government/publications/apprenticeship-funding . Such courses have the real value of equal recognition (in UCAS points) to academic qualifications.
7. Measure and evaluate: A simple measure is to monitor that the learning has been applied in the workplace. This facilitates productivity improvements to be measured using your in-house KPI’s. Travel has grown accustomed to A/B testing for marketing and similar discipline can be applied to skills development. Once mastering the basics, these can be developed into more sophisticated financial models covering a range of costs and benefits. A good example is here https://academy.treasurers.org/resources/how-to-calculate-roi-on-team-training . However don’t forget to scope key elements such as savings in recruitment costs which will be the result of a strong retention policy.
To learn more, please join us for the latest webinar, “Skills Development, expense or revenue generator? Is educating your team a smart investment and if so how?” on Thursday 24th February at 10.00 hours GMT / 11.00 hours CET.
The team at LVG Learning & Networking, bring together a panel of experts both from inside the travel sector and from the broader economy to discuss real-world solutions.
So if upskilling is an investment your business businesses can’t afford to do without, then we look forward to you company in helping build viable, skilled jobs that will underpin the long term health of our sector.