Turnover rates in the Hospitality Industry

October 11, 2023 •

6 min reading

High Turnover in the Hospitality Industry: A Result of Neglected Training


In the hospitality industry, providing excellent service is crucial to success. However, achieving this goal is not easy, as the industry is complex and requires a high level of dedication and skill. One of the most significant challenges faced by hospitality businesses is high staff turnover rates.

The average 2021 turnover rate in the USA in the leisure and hospitality industry was 84.9% compared to the overall rate of 47.2% nationally.

This trend has been a longstanding challenge for hospitality businesses, but what is causing it? One important answer to consider is: neglected training. When employees are not given sufficient training, they struggle to perform their duties, which leads to low morale, dissatisfaction with their jobs, and ultimately, attrition. Providing comprehensive training programs is essential to equip employees with the necessary skills and knowledge to succeed in the industry.

In this blog post, we will explore the impact of high turnover rates, the importance of proper training, and effective training strategies to help reduce turnover rates in the hospitality industry.


The Impact of High Turnover Rates

Some major impacts of high turnover rates include reduced productivity, increased costs, decreased customer satisfaction, and elevated stress levels among employees. To help reduce the impact of a high turnover rate, businesses must recognize the warning signs and take steps to address the issue.

1. The Effects of High Turnover Rates on Businesses

The primary effect of a high turnover rate on a business is financial strain. It is estimated that it costs nearly double the annual salary of an employee to recruit and train a replacement. As the number of employees vacating their posts increases, companies are forced to spend more money for recruitment and training. Additionally, a high turnover rate has the potential to reduce the company’s overall productivity, as current employees are forced to take on more tasks until the new recruit is fully trained to handle his or her duties. A company with a high turnover rate can also encounter issues with morale and reputation. Often, residents in the community are aware of the turnover rate, arousing suspicions that something is amiss in the establishment, which can drive down sales.

2. The Effects of High Turnover on Employees

When a business has a high turnover rate, employees tend to become overwhelmed with the workload. Employers expect current employees to take on additional responsibilities, frequently forcing them to work more hours. This increases stress and fatigue levels among employees, creating an environment that is not conducive to productivity or job satisfaction. Furthermore, a high employee turnover rate can be damaging to an employee's morale. Experiencing long-term job instability has a detrimental effect on mental wellbeing, leaving them feeling uncertain about their future and security.

3. The Effects of High Turnover on Customers

A high turnover rate can also have an impact on customer satisfaction. As new employees are constantly being trained, there can be gaps in the service that customers receive. This has the potential to damage the company’s customer relationship, as customers may feel as if they are not getting the same level of attention and treatment that they once did, or they expect. Businesses with high turnover rates are also more likely to experience a lack of continuity in customer service, resulting in customer complaints and frustrations.


The importance of training

Insufficient training and development in hospitality play an undeniable role in high turnover rates. Low retention rates leave management with fewer choices, and often leads to under trained and ill-prepared employees placed into critical positions without the necessary skills and knowledge.

1. Reduced Staff Turnover

In today’s competitive job market, employees are increasingly seeking ways to differentiate themselves from their peers. By investing in staff training, organizations can take the lead in helping employees progress and enhance their career prospects. The results are clear to see; training programs have been proven to make employees feel more appreciated and valued, thereby increasing staff loyalty and retention levels.

2. Improved Employee Job Performance

By offering in-depth training and access to the relevant resources, employers can ensure that staff members are comfortable and confident in their role. This in turn leads to higher quality performance and enhanced job satisfaction. Providing staff members with the right training can also help to reduce errors and accidents in the workplace, saving the organization both time and money in the long run.

3. Increased Guest Satisfaction

Training is also vital for customer-centric businesses because it greatly increases guest satisfaction. This is because training enables staff members to become familiar with the products and services offered by the organization in much greater depth. In addition to this, employees will also be able to provide an enhanced level of service to guests by being able to answer their questions more accurately and confidently.

4. Improved Employee Morale and Engagement

In addition to the other benefits outlined above, training programs also have the potential to improve employee morale and engagement levels. By giving staff members the opportunity to learn new skills, gain new qualifications, and progress in their careers, employers make them feel more motivated and valued. This in turn leads to increased employee engagement, which is a vital part of building a high-performing team.


Neglected Training: Deeper Causes of High Turnover

Training is often ignored, overlooked, or deprioritized as organizations make decisions on how best to allocate limited resources.

1. Failure to anticipate role changes

Without a focus on anticipating role changes, organizations are at risk of not providing the necessary training to employees when they move into new roles. If employees don’t understand the tasks and key responsibilities of their role, they might feel frustrated and incompetent. This lack of training can eventually result in employees feeling like they are not appreciated or valued by the organization, which can lead to resentment and a greater likelihood of turnover.

2. Lack of communication

Without proper communication or information dissemination to employees, it is very difficult to ensure that employees are receiving all the necessary training and development they require to be successful in their role. Poor communication can lead to a lack of knowledge transfer, as well as a lack of understanding of the purpose and value of training. Failure to communicate about training can cause employees to feel like their input and their development is not important to the organizational culture.

3. Lack of incentives and motivation

If employees have the impression that they are not being rewarded or recognized for their performance, they may be less likely to devote their time to training. Organizations should consider implementing reward and recognition systems to help incentivize employees to take part in training.

4. Lack of resources

Since organizations try to allocate resources based on where the highest returns can be achieved, training may become an area of low priority if it is not seen to have direct returns. In such situations, the organization should prioritize their resources to ensure that training still gets the necessary resources allocated to it, and that employees still receive the training they need.

5. Shortage of time

Training is often seen as a luxury more than a necessity, and without proper time management, training can be put on the back-burner while other tasks and activities are prioritized. It is important that organizations make time for training, and have a system in place to indicate which tasks and activities take higher priority.

6. Poor management

Employees working with poorly rated managers are four times more likely to change jobs.

If managers and supervisors are not providing adequate training, employees start to believe that their employer doesn’t care about their professional development. This lack of support and guidance can sour the employee/employer relationship, sending workers headed to the door.

7. When training “isn’t a priority”

Organizations should be aware of the value of training, and how it can lead to increased productivity and employee satisfaction. Without this awareness, training may be seen more as a cost rather than a benefit, which can lead to it being deprioritized in favor of other activities.

Employee training programs play a critical role in reducing staff turnover rates and improving employee job performance. When employees receive proper training, they feel confident and prepared to take on their responsibilities, leading to increased job satisfaction and engagement. This, in turn, leads to improved guest satisfaction and a better reputation for the business. Neglected training is a common concern in the hospitality industry, as managers frequently prioritize other aspects of their business over employee training. However, investing in training programs is a necessary expense that pays dividends in the long run.

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"Success in hospitality requires more than the energy and enthusiasm of a few; it takes the collective drive and commitment of all staff for long-term sustainability. It is only with a long-term view that companies in this industry can address high turnover and keep their service quality consistent. Investing in training for employees is essential to improving customer satisfaction and loyalty, and ensuring job satisfaction and retention. A well-trained workforce will be not only better equipped to meet customers needs, but also provide the organization with better cost-management, increased productivity and enhanced customer satisfaction. Companies in the hospitality industry need to recognize that employees are their strongest assets and provide them with the education and tools needed to be successful. Ultimately, this commitment to training will lead to higher satisfaction for both employees and customers, and greater long-term success for the company.
"Neglecting training can lead to a host of problems for an organization, including high turnover rates. Organizations should be aware of the dangers associated with not prioritizing training, and should dedicate the necessary resources and time to ensure that their employees are adequately trained and supported. Failure to do so could have serious financial repercussions, as well as a negative impact on employee morale."