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Labor Shortage Leads to Fierce Competition in Chicago’s Hospitality Industry, with Cash Promised and Jobs on Site | Company

When a manager of a short-staffed Chicago-area restaurant snuck into Lucca Osteria in Oak Brook, Illinois. on a recent Friday with a handful of cash, the brazen worker poaching seemed straight out of the pages of Nelson Algren.

“It was the end of May, the third week we were open, and I get a call from my partner, who is fuming, and he says, ‘You won’t believe this, but two of our bus boys are from here. come up to me and said this guy told them they were guaranteed $1,000 a week to go to the bus tables in his restaurant, and they’re gonna go so they came out and left us dry said Steven Hartenstein, owner of Lucca Osteria and chief operating officer/business development director of Phil Stefani Signature Restaurants.

“We’re all in this together, so it’s hard to believe that some people are poaching workers from their friends,” Hartenstein said. “People can steal your people, your recipes and your brand, but they can’t steal your hospitality and your integrity.”

While it’s rare to “recruit” workers among other restaurateurs by posting $100 bills and guaranteeing a lucrative salary, the urgency to staff Chicago’s hospitality industry came to a head this summer. , fomenting what some in the hospitality industry call “a survival of the fittest” environment.

The severe labor shortage needed to keep restaurants and hotels running is also prompting many employers to offer improved wages and benefits, along with a new effort to promote the industry as a promising career path. with great potential for advancement.

As a rebound in tourism leads to more hotel stays, a recent survey by the American Hotel & Lodging Association found that 97% of respondents in the United States said they were experiencing staff shortages, and nearly half of all hotels said they were “severely understaffed”.

The most critical staffing need is housekeeping, with 58% ranking it as their biggest challenge, and to meet demand, hotels are offering a list of incentives for potential hires, with nearly 90% of hotels citing increased pay, with 71% offering more flexible deals. hours and 43% increase in benefits, AHLA officials said.

Staffing issues prompted the organization to launch a new campaign, “A Place to Stay,” targeting 14 cities, including Chicago, as well as Atlanta, Baltimore, Dallas, Denver, Houston, Los Angeles, Miami, Nashville , New York, Orlando, Phoenix, San Diego and Tampa.

“These jobs are paying more than they’ve ever paid, with greater flexibility, greater benefits,” AHLA CEO Chip Rogers said at a press conference in Chicago earlier this month. . “The message is clear: if you want to start a career in hospitality, there’s absolutely no better time to do it, and no better place to do it than here in Chicago.”

According to the U.S. Bureau of Labor Statistics, as of June 2022, employment in the broader recreation and hospitality sector had declined by nearly 1.3 million jobs, or 7.8%, compared to compared to February 2020. US hotels employed 2.3 million people before the pandemic, and ended 2021 with 1.8 million.

Although still below pre-pandemic levels, the number of hospitality workers in Illinois is steadily increasing. The number of people employed in the sector rose to 582,800 in June, an increase of nearly 16% from the same month last year and the highest monthly total since the start of the pandemic, the data shows. from the Illinois Department of Employment Security.

But there are still many openings. Michael Jacobson, CEO of the Illinois Hotel and Lodging Association, said a morning earlier this month that there were 3,000 open positions at Chicago hotels listed on Indeed.com alone.

“Our jobs are often misinterpreted as dead-end, minimum-wage jobs,” Jacobson said. “And that, frankly, is not true. The fact is, our salaries are higher than they’ve ever been with more benefits than we’ve ever seen for our employees.

The starting salary at most hotels in Chicago is $23 an hour plus benefits, Jacobson said, adding, “People don’t realize that no matter what you’re interested in or your journey in life, it’s there is a position open for you in a hotel.”

In addition to health care, 401(k) plans and travel discounts, Jacobson touted the industry’s flexible hours, which he said can accommodate parents or students who have to work irregular hours. Hotels can provide jobs for people who don’t speak English, and perhaps most importantly, offer rapid career growth, he said.

“Working in a hotel paves the way to the middle class for individuals from all parts of Chicagoland and from all walks of life,” Jacobson said.

Juan Leyva, managing director of LondonHouse, said he was looking for candidates to fill several openings at the city center hotel, including reception staff and a bartender for its LH Rooftop, a popular rooftop bar overlooking the Chicago River.

“The past two years have been tough in the hospitality industry, but June was one of the best months we’ve ever had at the hotel, even before the pandemic,” Leyva said.

“Every hotel is hiring right now, especially for the front of the house, where in some cases people are hired on the spot because if you don’t make them an offer, they’ll just move on to the competition,” a Leyva said.

Labor shortages have affected service, with some hotels offering housekeeping only upon request. reduce the number of hotel rooms available for booking; and declining reservations or limited hours at restaurants facing a shortage of cooks and servers.

“Hotels are often in competition with each other to find people, and unfortunately when you don’t have the manpower, it’s going to create a lot of customer dissatisfaction,” said Amrik Singh, associate professor at the Fritz Knoebel School of University of Denver. Hospitality management.

Recent difficulties in finding hospitality workers date back to the early days of the pandemic, when Illinois lost nearly half of its hospitality jobs. The number of people employed in the industry fell from 602,600 to 329,400 between March and April 2020, according to state data.

According to Unite Here, the union representing 300,000 workers in the hospitality, gaming, restaurant, manufacturing, textile, distribution, laundry, transport and airport sectors, the COVID-19 closures 19 at its peak brought 98% of its members to the United States. and Canada losing their jobs.

“Now a lot of them don’t want to come back, especially if they’ve found jobs in another sector, with higher pay and the ability to work from home, which you can’t do with most hotel jobs,” Singh said.

“When there’s a labor shortage and your industry offers the lowest hourly wage, people will be reluctant to take those jobs, especially if they’re worried about going back to their old employer and might end up quitting. to fuck. if there is another crisis,” Singh said.

As the U.S. labor market remains broadly robust this summer, some experts have suggested that the Federal Reserve’s decision to temper inflation by raising interest rates could cause the economy to slow, leading to job losses. jobs.

Mary Skoubis, LondonHouse’s chief concierge, said she had spent 20 years working for a Gold Coast hotel when she was furloughed at the start of the pandemic and then never been called back to work.

“It was awful, because I loved what I did, and for many years I was their front office manager, which was phenomenal work,” Skoubis said. “I was fired because my work was not considered essential.”

More than a year later, in June 2021, Skoubis said she received a “phenomenal call” with a job offer from LondonHouse, which she immediately accepted.

“I’m a person who has the need to work, I couldn’t afford not to, but I’m doing what I love and working in this beautiful environment,” Skoubis said.

Alongside the upscale environment offered in some of the city center’s swankiest hotels, industry advocates say hospitality can also offer strong opportunities for advancement, with some managers climbing the ladder from entry-level positions.

Jeovanny Arellano, operations manager at LondonHouse, said he started working in housekeeping at a suburban hotel when he was a computer science student. Instead of being discouraged by the hard work, he quickly “fell in love with hospitality”.

“Chicago is a big city, but when it comes to the hospitality industry, everyone knows each other,” said Arellano, 35, who was recruited for his current role at LondonHouse by Leyva.

Robert Habeeb, CEO of Maverick Hotels and Restaurants, which counts Offshore Rooftop and Bar and Sable at Navy Pier among its properties, said that while the hospitality industry is still hiring, “the biggest challenge during this busy summer is keeping your fully staffed operations”.

“The market is so competitive right now, the demand for staff is increasing, and even once workers are hired, you have to fight to keep them from leaving,” Habeeb said. “Anyone can have a bad day at work, but now that there are so many jobs, some employees are quick to jump ship.”

While the brazen tactics of the ‘recruiter’ recently spotted doling out money to entice bus boys might be extreme, Habeeb said they underscore the hopelessness facing an industry where customer service is the key. corner stone.

“When we finally got the green light and the pandemic restrictions were lifted, people rushed in,” Habeeb said. “But now everywhere you go places are understaffed. … Part of the bloom comes off the rose, and it all goes back to COVID.

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