Labour costs outpace revenue growth in Thai tourism sector

[webfact]

 

Rising labour costs in the tourism sector are outpacing revenue growth, resulting in increased hotel expenses, as revealed by hospitality market analyst STR. Jesper Palmqvist, senior director for Asia-Pacific at STR, warned that the only risk for hotels this year is maintaining cost controls in light of the extraordinary growth of labour costs and room rates.

 

Over the past one to one and a half years, room rates have experienced a significant increase, allowing some Thai hotels to command room rates that were 20-25% higher than in 2019. However, Palmqvist revealed that the rate of this growth has already started to decelerate.

 

“For the market, we don’t see rates dropping much because as costs have gone up for hotels, the biggest cost continues to be labour costs.”

The driving force behind this trend is the persistent labour shortage in the tourism sector. To attract employees, operators have to offer highly competitive salaries, but interest in working in the industry has waned, stated Palmqvist.

 

by Alex Morgan

PHOTO: via Linkedin

 

Full story: The Thaiger 2024-02-05

 

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[hotchilli]

Is this a new thing or has this been an issue for hotels etc since the beginning of time?

It's called managing your business.

[Will B Good]

2 hours ago, webfact said:

Rising labour costs in the tourism sector are outpacing revenue growth, resulting in increased hotel expenses

Which reads....."our profits might not be as huge as expected as we are having to pay people a reasonable wage/salary".........boo hoo.

[bkk6060]

https://www.statista.com/statistics/1402913/thailand-average-staff-wage-of-hotel-and-food-service-per-month/#:~:text=Average monthly wage for hotel and food service workers Thailand 2014-2022&text=In 2022%2C the average monthly,higher than the previous year.

 

Some of the larger hotel chains in Bangkok have been using student interns as staff but their prices are up 50%. And, the hotel staff workers don't make much anyway.

I call foul on this article the price increases seemed to occur after reopening I assume to make up for their losses or greed.

[Sluglord]

Just came here to say that Thai people are so underpaid. I realize that many if not most are rather unproductive that is a topic of another discussion. But the wages have been too low for too long and now with inflation life is really challenging.

 

The Thai government allowed simple people to accrue such massive debt.

 

 

When was the last time you heard anyone call this place the land of smiles?

Edited February 5 by Sluglord

[mommysboy]

Wages are low, thus, people can't afford to take the jobs.

[Gknrd]

Demographics. Less workers more money.

[StayinThailand2much]

8 hours ago, Sluglord said:

When was the last time you heard anyone call this place the land of smiles?

 

People in Cambodia are much poorer than people in Thailand, but they actually smile...

[StayinThailand2much]

1 hour ago, mommysboy said:

Wages are low, thus, people can't afford to take the jobs.

 

Yes, as the (relatively) high costs of transportation in Bangkok don't help. If they need to take both, the BTS and the MRT, plus motorbike taxis, etc., then a day's earnings are almost used up already.

[StayinThailand2much]

1 hour ago, Gknrd said:

Demographics. Less workers more money.

 

Almost zero immigration, and less migrant workers, while birth rates have been way down for a while...