HOSPITALITY INDUSTRY OUTLOOK STILL ON SHAKY GROUND
Hiring spiked in March nationally in the leisure and hospitality sector, payroll management giant ADP reported Wednesday, with hotels, restaurants and entertainment venues adding an estimated 169,000 jobs.
But the head of the Connecticut Lodging Association warned that the state’s hospitality sector may need another two years to fully rebound, despite the accelerating pace of vaccinations and a return of events that drive bookings like graduations and weddings.
That means more hard times for waiters, hotel housekeepers, event managers, back-office staff and other Connecticut workers.
Nationally, March was the biggest hiring boom for any industry in any month since September 2020, when Amazon warehouses and package delivery companies hired more than 190,000 people to meet the anticipated boom in online holiday shopping.
ADP based its study on employment numbers collected while managing payroll for millions of companies nationally, giving it a far larger sample size than U.S. Department of Labor surveys that contribute to monthly jobs estimates.
Private-sector employers added more than a half-million jobs in March.
The report does not break out hiring by state, leaving open the question of whether or not Connecticut is seeing an upswing in leisure sector hiring, even as venues get a sustained burst of business beyond what they can handle at pandemic staffing levels.
“As more people are becoming vaccinated and we are into spring break season, that would have accounted for the uptick in some of the people coming back to work,” said Ginny Kozlowski, executive director of both the Connecticut Lodging Association and Visit New Haven. “And some states lifting any kind of mandate and opening up fully would have also brought people back.”
“What we are seeing in Connecticut is that there is some increased demand,” Kozlowski added. “We are also seeing some increased leisure travel within the state, ... including overnight stays. In terms of future bookings, we are seeing more inquiries.”
Back-to-basics
On Tuesday, newly finalized DOL data for the first week of March showed the single biggest weekly drop in unemployment for Connecticut’s food and accommodations workers since last September.
But as of early March, nearly 27,000 hospitality workers were drawing jobless benefits in Connecticut, a higher number than the week of Christmas.
And over the following two weeks, the state received nearly 8,300 initial claims for benefits from workers in the leisure sector. The large majority of those represent workers laid off a year ago after the pandemic hit Connecticut, many of whom had to refile after 52 weeks in order to have their aid extended for additional months under federal relief programs.
A DOL spokesperson indicated Wednesday that it has yet to adjust
its database reporting tool to distinguish new claims from extensions by those already receiving benefits.
The Indeed jobs board listed less than 5,000 openings at restaurants and hotels across Connecticut as of Wednesday.
Connecticut is allowing restaurants to extend outdoor dining permits — which they received at the outset of the COVID-19 pandemic — to next year, and also eased some capacity limitations that had been put in place to limit transmission of the virus.
Some restaurant groups are continuing to move ahead with new openings across Connecticut, including Darden Restaurants, which is opening Connecticut’s first Yard House sports pub at the SoNo Collection mall in South Norwalk.
Plans are also in place to build a LongHorn Steakhouse at Danbury Fair mall, adjacent to a new Shake Shack that will include a drive-through window.
Darden CEO Gene Lee said last week on a conference call that the company is counting on a renewed appetite for in-restaurant dining, saying takeout is only viable over the long term as a side service.
As of early March, Darden employed 115,000 hourly workers across its brands — including Olive Garden and The Capital Grille — a number that decreased from 165,000 before the COVID-19 pandemic.
“That number is increasing every week,” Lee said. “I think our greatest challenge right now is staffing, trying to attract people to come to work . ... What we’re focused on is really back-to-basics restaurant operations.”
The delayed rebound in business travel and events is leaving a lasting impression on area hotels and other Connecticut venues.
In the past month, the Hyatt Regency Greenwich and the Hartford Windsor Marriott notified the state of indefinite extensions of furloughs they instituted last year. Both continue operating with skeleton staff in place; Hartford Windsor Marriott employs less than 40 workers, with another 75 remaining on furlough.
In notifications to the Connecticut Department of Labor, the Hyatt Regency Greenwich signaled that it laid off workers in October, after initially bringing back some employees from furlough last summer.
“While there are encouraging signs that our economy can begin to reopen in some areas, it has now become clear that the demand for travel, events, and hospitality services will take substantially longer to resume than previously anticipated,” Sherry Hicks-Buckles, general manager of the Hyatt Regency Greenwich, said in a DOL filing this month. “With likely [ongoing] social distancing until a reliable COVID-19 vaccine or treatment becomes available, we cannot predict when our way of doing business will return to ‘normal.’”