The Hotel industry in India has overstepped the IT and ITES industry in hiring employees. But still the industry faces acute shortage of human resource. The recent Employment Trend Survey conducted, Ma Foi Randstad the industry has recruited more employees than the IT-ITES industry. The Hospitality industry hired 48,000 employees in the period between July-September, while the IT-ITES has hired only 46,000. The growth of the hospitality industry in India demands more employees to meet the requirements. There has been increase in the number of hotel rooms, and stand alone restaurants during the recent past, according to sources from the industry.

Huge manpower requirement in the hospitality sector

The study observes that the hospitality industry will need an additional 40,000 man power at the least towards the end of the year. The hospitality sector has exhibited stable and high growth in the last quarter of 2010. Most of the companies in the hospitality industry are optimistic about the growth in the sector and shows high expectations for the coming years. As a result the growth of employment opportunities in the sector is going to be increased in the coming months.

Increase in the number of rooms and hotels

There has been a steady increase in the number of approvals for starting new hotels. This along with the huge investment in the hotel infrastructure in Tier 1 cities as well as in tier2 and tier 3 cities has resulted in the generation of large number of job opportunities at all levels.

The players expect the number of tourist to increase in recent years

The arrival of foreign tourist in India was at 7.9 % during the period between October and December. The major players in the industry believe that it will increase in the years to come. The foreign exchange earnings from tourism have increased during the fourth quarter of 2010, as compared to the same period in the previous year. The rising demand for tourism activities in the Indian market and in the global market has led to increased recruitment by large tour operators and travel agencies. Large number of hospitality companies is trying to incorporate different tourism products within their service portfolio. This has also accelerated hiring by these companies at all level. According to the leading companies in the Incentives, Hospitality sector, Meetings, Conferencing and Exhibitions (MICE) have emerged as major revenue generating activities for the sector. This calls for increased need for hiring skilled human resource in this sector.

Hotels increasing rooms in their inventory

If we look at the trend of leading hotel chains in the country, there are about one lakh rooms in the inventory. This figure is going to double in the recent years to come. The Taj Hotels currently has 14,000 rooms in its inventory. They plan to add about 11,000 rooms to their inventory in the next couple of years. The other leading players such as ITC is expected to add 15,000 rooms, Marriott International will add another 12,000, and Leela group plans to add a few thousand rooms to their inventory.

Supply of graduates much less than demand

As a normal standard in the hotel industry, a room needs 1.75 men. So as the leading players plan to add about 30,000 rooms in total, it is expected that the players will have to recruit about 50,000 employees to meet their requirements. The hotel management institutes in India produces only about 10,000 graduates every year, which is too short to meet the requirements of the industry.

Shortage of man power and attrition- the major issue in hospitality industry

According to sources from the industry, if the players in the industry start to introduce one hotel every month, in the years to come, human resource shortage and attrition will be major issues that the industry will be facing. The report says that major chunk of demand will arise in areas such as food and beverage service, kitchen, front office and house keeping.

The hospitality industry is facing a significant level of attrition, which is near to 30 per cent. According to Mr. Natarajan, Honorary Secretary, South India Hotels and Restaurants Association and Chief Executive Officer of the Chennai based GRT Hotels and Resorts chain, hotel employees’ jump from hotels to hotels to receive short term benefits.

Other sectors competing for talent pool

Other sectors such as IT, retail and aviation also takes a smaller portion of the talent pool. In addition to this the increasing number of stand alone restaurants also hunts for hotel management graduates. Experts in the industry say that the players in the hospitality sector should join hands to create a talent pool through public private partnerships.

Employees define a brand

Being in the service industry, employees are the primary factor that defines a brand. This calls for the need of employee retention. Mr. Natarajan also agrees that the attrition rate in the industry is about 30 per cent. This has led to the rising employee cost. He added that the payroll expenses have increased from 14 per cent of the total revenue to 30 per cent, in the present day.

According to Mr. Ajay K. Bakaya, Executive Director of Sarover Hotels and resorts, a possible solution to over come the problem of attrition is to provide in house training and development programs.

It is not only the hospitality industry that faces shortage of talents and the problem of attrition. Sectors such as IT and health care are also facing huge attrition rates in India. The Information Technology and Information Technology Enabled Services industry has registered the highest attrition rate of 23 per cent during the first quarter of 2010-2011. The attrition rate in the financial services industry was 18 per cent and that with the health care sector was 12 per cent. The FMCG industry experienced an attrition rate of 11 per cent, and the automobile and manufacturing sector was also clocked in at 11 per cent attrition rate. The major factors leading to high attrition in various industries are the high compensation packages offered, career growth prospects and relation with managers.