Bay Area hotel layoffs might be the beginning of even bigger job losses

More than 1,400 in Northern California have lost positions due to coronavirus cuts

SAN MARTIN » At least 1,400 hotel workers in Northern California have lost jobs or been shoved into indefinite furloughs amid the coronavirus fallout, but these might be just a grim vanguard of further economic reductions.

Hotel worker layoffs in the Bay Area and nearby regions total at least 1,431, according to new estimates by state labor officials, but several experts warn that the newly announced cutbacks are merely the beginning of widespread economic devastation in California’s crucial lodging and travel sectors.

“This is only the start of the hotel layoffs,” said Alan Reay, president of Irvine-based Atlas Hospitality Group, which tracks the California lodging market. “The majority of hotels in California and nationwide are reducing operations or closing temporarily.”

More than 400,000 jobs supported by the hotel sector or directly connected to hotel operations are expected to be cut in California, according to an Oxford Economics study released by the American Hotel & Lodging Association.

“Those numbers may be conservative,” Reay said.

Roughly 414,000 jobs, or a staggering 40.8 percent of the nearly 1.02 million jobs directly or indirectly associated with California’s hotel industry, are being eliminated due to the effects of the coronavirus, the hotel association and Oxford Economics study determined.

The reasons are simple yet brutal.

Multiple states, including California, have issued orders to slash the operations of an array of non-essential businesses, including hotels, in a quest to corral the spread of the coronavirus. As a result, people simply have begun to shun hotel visits in growing numbers.

“Drastic declines in occupancy rates will lead to massive job losses for individuals across the industry,” the American Hotel & Lodging Association stated in its report.

Job cuts are being planned in at least five hotel complexes in Northern California, consisting of three in the Bay Area and two in Monterey County, according to several official filings with the state’s Employment Development Department.

“Hotel owners are already reporting facing massive, unavoidable layoffs and furloughs,” the hotel association stated.