Before COVID-19 turned the world upside down, the hospitality and tourism industry was responsible for more than 10 percent of global GDP and one in every 10 jobs worldwide, according to the World Travel & Tourism Council (WTTC). It was also one of the fastest-growing fields, accounting for one in four new jobs created over the previous five years.
The pandemic changed all that, at least temporarily. While few segments of the economy were spared, hospitality and tourism were particularly hard hit. The WTTC reported that the sector lost $4.5 trillion in 2020, with its contribution to GDP plummeting 49.1 percent, compared with just a 3.7 percent decline in the overall global economy.
While COVID-19 has caused significant disruption, the hospitality and tourism industry is resilient and is coming back stronger following previous downturns, such as those caused by the 9/11 terrorist attacks and the 2008 economic crash, according to Dr. Hicham Jaddoud, who teaches Global Hospitality and Tourism in the USC Bovard College’s Online Master of Science in Hospitality and Tourism program.
“Growth in the sector has become greater after each crisis,” he says. “Why? Because hospitality takes advantage of that slow time to retrain, refresh and develop new concepts that are even more appealing to consumers.”
In spite of the recent tumult—and in many ways because of it—Jaddoud and other experts say the industry is now accelerating some of its longstanding priorities in the areas of sustainability, efficiency, innovation and technology.
Renewed Focus on Renewables
The Environmental Protection Agency estimates an average of 63 million tons of food waste per year in the United States alone, with some 40 percent of that accounted for by hotels and other consumer-facing businesses, according to the American Hotel and Lodging Association. Meanwhile, daily water usage per occupied hotel room averages 100 to 400 gallons.
While many hospitality organizations were introducing more sustainable practices pre-pandemic, in reality it remained challenging for large parts of the sector.
“The industry was moving at such a quick pace,” says Diana C. Beltran, a hospitality management executive who teaches Managing Service Quality in Hospitality and Tourism at USC Bovard. “Tourism was growing exponentially every year. There was just no time to focus on reducing energy consumption, for instance. We should have always been operating smartly and efficiently yet many in the industry were just operating as fast as they could with the priority of making sales. There was no incentive nor time to operate efficiently. Now we really have to buckle our belts and cut costs since the sales are no longer there and there is more time to look at details in the operation.”
“Weaker players are exiting the marketplace or are being absorbed by stronger players,” Leonard Jackson, a specialist in business development and financial management who teaches at USC Bovard, adds. “Some companies are using available government funding to retool, renovate and get their properties ready to come back once this pandemic is over. In a sense, the industry is righting itself.”
This includes upgrades to laundry facilities, showers and toilets in individual rooms, and other methods to reduce water consumption.
Beltran agrees. “Renovations are taking place left and right,” she says. “Facilities that have been closed are taking the time to renovate and become more efficient.”
The industry is fully embracing corporate social responsibility initiatives, says Jackson. “New buildings are incorporating sustainable practices,” he says. “That was becoming the norm, even prior to COVID, but it will increase. This is all consumer-driven. Consumers generally want to stay and host their events at green facilities.”
“Now there’s the opportunity for tourism and hospitality brands to evolve and become more conscientious to attract people who understand why they need to pay extra for a specific initiative that’s sustainable and more mindful of long-term impact,” notes Anna Abelson, a destination marketing expert who teaches Marketing Strategies for Hospitality and Tourism at USC Bovard.
“Guests know what they want from a business, which is to be sustainably and environmentally responsible, and they only support businesses that go that route,” Jaddoud adds. “That goes for minimizing food waste, consumption of water, use of soap and chemicals, and choosing local produce and supplies.”
The Challenge of Disposables
The industry had been retreating from single-use plastics—including flatware and straws—to meet both consumer demand and increased restrictions on such products in environmentally conscious locales. But with the advent of COVID-19, companies returned to disposables for safety reasons and to boost confidence among consumers.
“Single-use utensils are something you want to get away from if you want to protect the climate, but it’s something we have to have right now,” Abelson notes.
“When companies go back to normal flatware, there will be an additional cost,” Jaddoud adds. “Now flatware has to be cleaned in very specific temperatures, using specific chemicals and processes. But at the end of the day, it’s safety that counts.”
He observes that such corporate decision-making revolves around market specifics as well as venue type. For example, he says a steakhouse or other upscale restaurant will avoid disposables whereas in a grab-and-go setting, consumers find them acceptable.
Beltran, however, says she is seeing more travelers willing to pack their own utensils and straws, as well as coffee mugs and water bottles. “The culture of the consumer is changing,” she says. “In addition to being more conscientious about bacteria, germs and viruses, they also want to reduce waste. It’s still going to take some time before we all get there. But it’s changing on both ends—the consumer and the industry.”
This move toward more sustainable practices will only increase, experts predict.
“Changes to operational practices that consumers were asking for during COVID are going to become the norm,” says Jackson. For instance, many restaurants have eliminated printed menus entirely, using QR codes scanned by customers to electronically access menu options. More patrons have opted to forgo hotel room cleaning. “If these trends continue, hotels and restaurants will benefit from an operational standpoint, while reducing their carbon footprint,” he says.
High-Tech vs. High-Touch
Meanwhile, certain trends already underway have sped up. For example, the pandemic expedited the industry’s move to contactless interactions—from hotel check-in to food ordering to booking and boarding flights, Jaddoud notes.
“COVID is reorganizing our industry, and we’re going to emerge stronger, leaner and more technologically savvy,” Jackson adds.
Yet that doesn’t mean the field will lose its human aspect. “Hospitality will always be a human interaction-driven industry but the pandemic has changed the preferences and tastes of the consumer,” Jaddoud says.
“Technology will be important, but hospitality brands should certainly keep that high-touch focus at the forefront, because technology is just one side of the coin,” Abelson agrees. “To build loyalty with customers, you need to make sure that you understand and customize their experience based on their needs and preferences so you really create that meaningful relationship for years to come.”
Retraining the Hospitality Workforce
Personnel must also keep pace with these changes. The WTTC notes that 68 percent of the travel and tourism workforce require some re-skilling in light of innovations occurring throughout the industry. Hospitality companies are also amping up efforts to attract and retain a more diverse talent pool.
The sector is training staff to implement contactless service and heightened hygiene measures, from sophisticated room cleaning approaches to and other protocols that build consumer confidence while protecting customer and employee safety. At many locations, employees will need to be taught how to take guests’ temperatures or how to manage visitors who refuse to comply with health-related policies. Other venues are introducing robots and other advanced technology to aid in the disinfecting process, and staff need to be educated on those efforts as well as encouraged to suggest new innovations.
“Hospitality is becoming more of a career path and not just a paycheck,” Jaddoud says. “This shift has happened in just the last few years—from both the employee and employer standpoint. It has made the hospitality industry better because when you have higher retention, you have more engagement and loyalty from the guests—and reduced training and turnover costs.”
Tourism and hospitality degree programs have seen a surge in applications as a result.
“New job profiles are emerging,” Beltran notes. “These include new positions that merge safety, quality and sustainability.”
The result will be more opportunity.
“I believe it’s the perfect time to be studying the hospitality environment,” Jaddoud says. “When companies come back, they’re going to be looking for more educated, critically thinking employees who are able to drive the industry forward.”
Students in the USC Bovard MS program come from a wide range of sectors within hospitality and tourism, including food and beverage, hotels, government tourism authorities, airlines, cruises, resorts and casinos. “It adds a lot of value,” Jaddoud says of the breadth of backgrounds represented. “Skills are transferable between all segments of hospitality and tourism.”
“Our industry is multifaceted. Students also learn from each other because everybody brings a different perspective,” says Abelson, who adds that students also vary in terms of their expertise and current roles within the industry. “Some have significant experience but want validation or to fine-tune their skills, and some are learning from the ground up,” she notes. “They’re a very impressive group of people who learn and apply the skills or knowledge right away.”
Learn more about the MS in Hospitality & Tourism program.