This article consists of 09 pages with a word count of 2933. In order to have full access to this article, email us at thedocumentco@hotmail.co.uk.
Ref No: 39161

2. Literature review

Hospitality Industry in the UK

The hospitality industry in the UK is the largest sector that contributes to its economy. From restaurants to hotels, the best choice of employment is the hospitality and tourism industry (Barron, Leask, and Fyall, 2014). However, the sector is known to be the one with the highest turnover. As per the research by YouGov, the staff retention level in the UK hospitality industry is at 70%. Employee turnover is hard to manage and is down to a number of factors. There are several contributing factors.

Unsuitability for the Role

Employees are the most challenging in the hospitality industry. The owners and managers have high frustration levels because of the continuous recruitment and firing procedures. Further, it also increases costs. The turnover does not explain that organisations are bad places to work, but many times the employees are not suitable. According to to the statistics, the average tenure is 12 months for a worker who works in the hospitality industry. There are several negative outcomes for high staff turnover and increased costs (Chung, and D’Annunzio-Green, 2018). Consequently, the financial statements are affected. It increases the cost by finding, hiring and training the new staff. According to the big hospitality, there is a lack of employee retention that costs the sector £275 million per year (Shaheen, Cohen, and Bayen, 2018a). This doesn’t take into account the number of wasted hours that owners and managers would put into training staff, only to have them leave shortly after.

Staff shortages

UK was dependent 70% on the workers that were EU nationals and after the Brexit there was staff shortages. Over 300,000 workers returned to their home country as the new legislation required people to leave the UK  after the Brexit the hospitality industry could not retain employees and reduce the turnover. After the pandemic, the travel restriction was a damaging situation for the UK. The COVID led to job losses and business closures. There were high recruitment issues. In April 80% of the hospitality firm was closed and stopped trading and 1.4 million workers had been furloughed. With the hospitality sector’s talent pool being significantly drained. The country now needs a solution. Moreover, there is also high turnover. Because of the turnover, employees and customers are affected too. Customers want to experience the best possible customer service that can run a business (Barron, Leask, and Fyall, 2014). A company is understaffed and requires talent that is very efficient in working in the hospitality industry. The new hires are not usually the best at training new staff members can mean that the staff are unable to provide their usual level of service. This can have a negative impact on a business’s reputation, not to mention a loss of profit through customers not returning.

Employee turnover in hospitality

According to the KPMG (2016) study, retaining staff in the hospitality industry in the UK is difficult. As per the research, human capital is the only strategy that could help cope with environmental uncertainty. It has also been a source of competitive advantage (Meyers and van Woerkom, 2014). The hospitality industry has been characterised as a sector with high employee turnover that often loses talent. Retaining and rescuing talent helps in gaining a competitive advantage among the competitors, resulting in a high market share. The high employee turnover can not be neglected and is a reality which is also a part of hospitality organisational culture. There are several reasons in the literature that identifies that high turnover causes limited opportunities for career development, low skills, poor pay when the seasons are off, unsocial behaviour and extended working hours, poor pay, seasonality unsociable and long working hours and poor work-life balance (C Brown et al., 2015); Lee and Ok, 2016). other reasons that relate to high turnover are the demographic variables. These demographic variables include age, education and job tenure. As a result of high turnover, there are many disadvantages in the business, like the cost and loss of expertise. These problems and costs have a high impact on the profitability and the service quality of the company working in the industry. An average hotel spends $109,909 to replace managerial and supervisory employees each year and $9,591 for operational staff (Davidson et al., 2010). Meyers & van Woerkom!(2014)explained that factors that have an influence on employee turnover are ob-related factors and organisational factors. On the contrary, job turnover also is related to positive outcomes such as idea-generating activities and knowledge circulation. Organisations should be cautious about the importance of the policies while retaining information from employees leaving the company. The transferring of information happens when one employee takes the knowledge to the other company. This is a huge challenge for companies. Even though employee turnover has a positive impact, there is also a negative outcome that could cause severe damage to the company (Brown et al., 2015). High turnover can be very critical when the effects are seen on talented employees that can contribute to the current and future success of the employees.