Hotels have failed to share the profits of their booming businesses with their workforce. Despite the industry’s rapid recovery after the recession, median earnings barely rose in real terms between 2008 and 2017. Pay in the industry is so low that over half of employees in the industry earn below the real Living Wage, with the number of employees not earning a living wage higher among:
Low pay, long hours and abuses of power such as sexual harassment are rife in the industry. In the words of one worker, ‘they treat us like machines’.
This report is the first of two reports looking at the hotel sector. This report will focus on pay. The second, to be published in early 2019, will look at how workers are treated while at work.
The UK’s hotel industry has made an impressive recovery since the 2008 recession. This recovery would have been impossible without the hundreds of thousands of workers that keep the accommodation industry in business.. Whether it’s through making beds, cleaning rooms, or cooking food for guests, their dedication and hard work means that both British and international visitors are able to enjoy the time they spend in hotels.
Despite the contribution they make to the success of the accommodation industry, hotel workers are often badly rewarded for their efforts. Low pay, long hours and abuses of power such as sexual harassment are rife in the industry. In the words of one worker, ‘they treat us like machines’.
This report is the first of two reports looking at the hotel sector. This report will focus on pay. The second, to be published in early 2019, will look at how workers are treated while at work. This will include issues such as long hours, health and safety and abuses of power.
The hotel industry is enjoying an impressive recovery. For example:
These profits are not being shared evenly. For the average employee, the accommodation industry is one of the most badly paid in the economy. The average employee receives £8.15 per hour, which is over £4 per hour less than the average employee in the economy as a whole.
Over half of the employees in the accommodation sector are paid below the real Living Wage, with the percentage of employees not paid the real Living Wage rising among certain groups. For example:
The accommodation sector does not offer its employees much scope for pay progression. An employee in the accommodation sector barely earns more in their thirties and forties than they do in their twenties. This goes against the trend in the rest of the economy. The highest earning age group in the accommodation sector, those in their forties, earns £54 per week less than the average employee across the whole economy between the ages of 22 to 29.
Excessive executive pay coexists with poor wages across the industry. While the average hotel sector employee is paid £8.15 per hour, Travelodge paid its board of directors a combined total of £5.4 million in 2017. Its best-paid director saw their remuneration package double, from £1.2 million to £2.5 million. Whitbread paid its board and CEO a combined total of over £4.7 million in the 2017/18 financial year.
The TUC believes that every worker deserves to have a great job. An essential part of this is fair pay.
We want the government to increase the national minimum wage to £10 as quickly as possible, and for this to include 21- to 25-year-olds. Due to the prevalence of low pay in the accommodation sector, with median pay for all employees being £8.15 per hour, this would improve the pay of the vast majority of employees in the sector.
Employees in the hotel sector also need a voice at work. As part of the Great Jobs Agenda, we want employers to:
Each of these would help to improve the pay of workers in the hotel sector, as well as lead to fairer distribution of the profits currently being enjoyed by the CEOs and boards of directors of hotel chains.
You can read more about the Great Jobs Agenda .