labor costs
2024 Budget Planning: What Is Top of Mind for Hotel Owners & Operators?
HotStats | October 19, 2023
Budget season is upon us, and around the world hotel owners and operators are buried deep in data trying to come up with 2024 performance numbers. What unique challenges are hotels facing in the 2024 budgeting and planning process? HotStats reached out to global hospitality leaders to find out. By Michael Grove Chief Operating Officer HotStats 1. 2023 Hotel Performance: Growth Is Slowing In UAE, Saudi Arabia, India, Brazil, and the Caribbean, hotel profit margins in the first half of 2023 well surpassed 2019 levels, whereas they lagged in the UK, Germany, Spain, Poland, and Qatar. In China, hotels experienced tremendous growth rel...
A Focus on the Margins: US Hotel Performance in the First Half of 2023
HotStats | August 18, 2023
by Laura Resco, HotStats Director of Hotel Intelligence Americas Hotels in the United States saw general pressure on profit margins in the first half of 2023, with Gross Operating Profit (GOP) margin falling by 1 percentage point compared to the same period in 2022. A closer look at brand-scale performance reveals that the extremes were particularly affected: both the luxury and midscale and economy segments exhibited the greatest year-on-year margin declines, as shown in Figure 1. [caption id="" align="alignnone" width="800"] Figure 1 US GOP as a % of Total Revenue, H1 2021, 2022 and 2023[/caption] A major factor influencing this tr...
Labor Costs Kept U.S. Hotel GOPPAR Down in June
Costar Group | August 4, 2023
Labor costs reached highest growth rate of pandemic-era WASHINGTON – 4 August 2023 – U.S. hotel gross operating profit per available room (GOPPAR) fell year over year for a second consecutive month, according to CoStar’s June 2023 P&L data release. CoStar is a leading provider of online real estate marketplaces, information and analytics in the property markets. June 2023 per-available-room metrics (% change from June 2022) GOPPAR: US$91.37 (-1.4%) TRevPAR: US$237.12 (+4.8%) EBITDA PAR: US$66.78 (-5.6%) LPAR (Labor Costs): US$75.48 (+13.4%) “Labor costs continued to rise year over year, growing nearly th...
U.S. Hotel Revenues, Profits and Labor Costs Reached Record-Highs in 2022
STR | February 8, 2023
HENDERSONVILLE, Tennessee—Total U.S. hotel revenues, profits and labor costs reached an all-time high, according to STR‘s P&L data for 2022. With more supply in the market, the key profitability metrics each came in lower than their pre-pandemic comparable on a per-available-room basis. 2022 estimated totals Revenue: US$239.7 billion GOP: $101.3 billion EBITDA: US$74.8 billion Labor: US$70.9 billion 2022 per-available-room metrics (% change from 2019) GOPPAR: US$73.70 (-5.5%) TRevPAR: US$202.23 (-4.3%) EBITDA PAR: US$52.20 (-5.6%) LPAR (Labor Costs): US$65.94 (-7.6%) “Total revenues ...
What to Expect in the Hospitality Industry in 2023
Mark D. Podgainy | January 30, 2023
By Mark D. Podgainy Last year was a year of dramatic recovery for the hospitality industry. What’s ahead for 2023? Definitely clouds, but the question is whether the clouds will pass over or they will result in a storm. What’s Ahead High labor costs will persist. While many workers have come back to the hospitality industry after leaving during the Covid-19 pandemic, the industry is still short of employees. This supply-demand imbalance will continue to keep labor costs high and impact margins. As the economy slows the supply of employees will grow (layoff announcements in the news have been increasing), but it is unkno...
Labor Shortages and The Impact on Hotel Operating Costs
John Smallwood, President of Travel Outlook | January 17, 2023
How Modern AI Solutions Offset Rising Costs That Cut into Hotel Profits By John Smallwood, President of Travel Outlook January 2023 Thanks to the perfect storm of the last two years, costs are skyrocketing across multiple industries, and the hospitality industry is no exception. Maintaining control over your hotel’s operation is key to running a successful and profitable business. Hotels all over the world have had to adapt to rising costs thanks to inflation, the pandemic, and labor shortages, all of which combine to threaten profitability and longevity. In a perfect world, hotels can seamlessly meet a never-ending stream of deman...
U.S. Hotel Profitability Improved in September; Labor Costs Exceed 2019
STR | November 1, 2022
HENDERSONVILLE, Tennessee—U.S. hotel gross operating profit per available room (GOPPAR) improved from the month prior and exceeded the pre-pandemic comparable, according to STR’s September 2022 P&L data release. Additionally, the cost of labor per available room came in higher than the pre-pandemic comparable for the first time. GOPPAR: US$84.03 TRevPAR: US$222.97 EBITDA PAR: US$60.71 LPAR (Labor Costs): US$71.52 “Labor costs moved ahead the 2019 comparable due to continued high levels of hospitality unemployment and more spending on contract labor,” said Raquel Ortiz, STR’s director of financial ...
Information and Telecommunications Costs
Robert Mandelbaum | June 27, 2022
By Robert Mandelbaum and Adam Barry Just as technology has become more ubiquitous throughout our lives, it is now impacting guest service and hotel operations throughout all departments in a hotel. To provide more exposure to the growing costs associated with hotel information and technology systems, the 11th edition of the Uniform System of Account for the Lodging Industry added a discrete undistributed department to capture these expenses. Prior to the 11th edition the costs for phone and internet service, payroll for telephone operators and computer technicians, and charges related to information systems were allocated to multiple depar...
