Australia Hotel Industry Staff Turnover Rate
How Much Does Labour Turnover Cost? A Study of Australian Four- and Five-Star Hotels
Abstract
Purpose: Employee turnover is a significant challenge for Human Resource Management (HRM) strategies and organisational performance. This study presents findings drawn from an extensive survey of labour turnover in the Australian accommodation sector. A particular focus is placed on turnover rates and costs.
Design/methodology/approach: Based on labour turnover literature and an industry panel, an online survey was designed and distributed to four- and five-star hotels across Australia. Human Resource Managers from 64 hotels participated in the survey, providing a representative sample and a response rate of 29 percent.
Findings and implications: The research shows the major costs being attributed to labour turnover. These are costs that both the industry and individual operators should examine closely as they impact substantially on hotel operating costs and profitability. It also indicates that the levels of service, consumer experience and value may be impacted.
Research limitations: A limitation of this study is its main focus on tangible labour turnover costs. Additionally, findings based on four- and five-star hotels may not apply to other accommodation sectors.
1
Originality/value: The literature on hotel labour and turnover costs is limited and this paper provides the first major study in the Australian context, adding new knowledge to our understanding of labour turnover and cost impact on hotels. It also suggests areas where hotels may better address the turnover issue.
Keywords Labour Turnover Costs, Hotels, Australia Paper type Research paper
2
Introduction
The Australian tourism industry is a leading industry contributing A$38,935 million or 3.7% of gross domestic product in 2006/2007, a 7.8% increase over the previous year and accounting for more than 10% of Australia’s export earnings (Australian Bureau of Statistics (ABS),
Abstract
Purpose: Employee turnover is a significant challenge for Human Resource Management (HRM) strategies and organisational performance. This study presents findings drawn from an extensive survey of labour turnover in the Australian accommodation sector. A particular focus is placed on turnover rates and costs.
Design/methodology/approach: Based on labour turnover literature and an industry panel, an online survey was designed and distributed to four- and five-star hotels across Australia. Human Resource Managers from 64 hotels participated in the survey, providing a representative sample and a response rate of 29 percent.
Findings and implications: The research shows the major costs being attributed to labour turnover. These are costs that both the industry and individual operators should examine closely as they impact substantially on hotel operating costs and profitability. It also indicates that the levels of service, consumer experience and value may be impacted.
Research limitations: A limitation of this study is its main focus on tangible labour turnover costs. Additionally, findings based on four- and five-star hotels may not apply to other accommodation sectors.
1
Originality/value: The literature on hotel labour and turnover costs is limited and this paper provides the first major study in the Australian context, adding new knowledge to our understanding of labour turnover and cost impact on hotels. It also suggests areas where hotels may better address the turnover issue.
Keywords Labour Turnover Costs, Hotels, Australia Paper type Research paper
2
Introduction
The Australian tourism industry is a leading industry contributing A$38,935 million or 3.7% of gross domestic product in 2006/2007, a 7.8% increase over the previous year and accounting for more than 10% of Australia’s export earnings (Australian Bureau of Statistics (ABS),