Understanding the Labour Market Dynamics in Australia

The labour-intensive hospitality industry is competitive and comprises young, unskilled, low-skilled, casual workers, including migrants. The macroeconomic, political, and social factors impact the hospitality industry’s external and internal labour markets. For instance, the hospitality industry in Sydney employs more migrants because it is a hub for international students and businesses. Thus, post-pandemic cities like Sydney, which heavily rely on migrant workers, have to face labour shortages due to visa backlogs or economic recession. Such factors pushed the locals to work double shifts, which led to burnout and leaving their jobs. In such scenarios, businesses are compelled to compete against other businesses and have a limited pool of available workforce.
Such internal and external markets, including demographic changes, demand for a young workforce, and increased participation from women, might directly affect HR practices, including employee/industrial relations, recruitment, and retention in response to variable demand.

The Role of Employer Branding

Employer branding is a critical strategy to attract and retain the right workforce in stiff competition for skilled expertise. A business can build its employer brand, which would help to differentiate the business from its counterparts, compelling the right talent to join their work culture. The business can highlight its values and work ethics by showcasing a positive and inclusive work environment. This strategy is somewhat cost-effective for small businesses that don’t want to spend too much on marketing and advertising. They can maintain their online presence through social media platforms, sharing employees’ testimonials and success stories regarding career growth and demonstrating long-term career opportunities.

Design Purposeful Jobs

Job designing is designing and customising jobs to satisfy stakeholders’ interest in looking for positions. Job design must be detailed, clear and unambiguous, covering every aspect of the job profile, including job conditions, work hours, knowledge, skills (social), standard of performance, duties, and responsibilities. The design must be based on the expectations of the employer, employee, and customer. For instance, the job design of a fast-food chain may focus on speed during service delivery, whereas a concierge position would require soft communication skills as a front-line staff member.
Job design must clearly outline the aspects of job rotation or job enlargement. For instance, employees can be asked to rotate between front-of-house and back-of-house roles, developing a broader skill set. This will help the HR manager to identify high-potential employees for leadership roles.
The other aspect of job design is job enrichment, which highlights various skill sets and task variety. For instance, a chef may create a new menu item from conceptualisation to presentation. What needs to be understood is that HR practices, before recruiting the workforce, must emphasise roles over jobs and encourage staff to take on responsibilities aligned with the business’s goals, making them aware of what the business expects from them during their employment.

Attracting and Hiring the Right Candidate

Recruitment is crucial in attracting suitable applicants for specific jobs to select the most appropriate candidate. HR practices in the hospitality industry lack systematic recruitment procedures. The recruitment and selection decisions are made in an informal, ad hoc and reactive manner.
The recruitment process involves having essential information like a job description, personnel specifications, and an understanding of the labour market. The process can be divided into two aspects, i.e., internal and external recruitment.

Checklist for Recruitment Planning

What positions within the hospitality business need to be filled?
How have these positions evolved, and are there changes in roles, responsibilities, or skill requirements?
What is the current state of the business workforce?
What are the essential skills and competencies required for different roles in the business?
Have there been any shifts in the skills that employers highly value?
How diverse is the current workforce, and is there a need for more diversity?
Is there potential for internal promotions or transfers to fill specific roles?
How can existing employees be encouraged to apply for new opportunities within the business?
What is the budget allocated for recruitment activities?
What are other hospitality businesses doing in terms of recruitment?
What recruitment technologies or tools are available and suitable for the hospitality business?

Candidate Analysis

Physical Characteristics: In the hospitality sector, physical attributes are crucial in manual roles like lifting heavy loads or maintaining a particular appearance, speech, and manner. HR managers must describe these attributes while ensuring candidates meet job demands.
Attainments: Educational and professional qualifications are fundamental in the hospitality industry, especially when filling skilled positions. HR managers must clearly define the qualifications and work experience required for each role. For instance, a luxury resort may prioritise candidates with culinary qualifications and significant experience, while hotels might seek candidates with a background in hospitality management.
General Intelligence: Problem-solving skills are essential in a fast-paced industry like hospitality. ‘aesthetic labour’ is considered ideal in the front-line hospitality business. HR managers must assess candidates (front-desk staff) for their ability to think on their feet, make decisions, and address challenges that may arise during customer interactions or operational processes.
Special Aptitudes: HR managers must identify the specific attributes and competencies relevant to each job and seek candidates with these qualities. For instance, a high-end bar or lounge may prioritise candidates with mixology skills and a deep understanding of customer service.
Disposition: Job-related behaviours, including friendliness and interpersonal skills, significantly impact customer satisfaction in the hospitality industry. HR managers must assess candidates’ dispositions to ensure they align with the business’s service-oriented culture. For instance, restaurants and cafes emphasise the importance of friendly and welcoming staff to enhance the overall dining experience.
Circumstances: Considering individual circumstances, such as domestic commitments and willingness to work unsocial hours, is crucial. Managers must be flexible and accommodate diverse needs to attract a broad spectrum of candidates.

Advertising

Regarding the external recruitment process, businesses, especially small businesses in the hospitality industry, must choose suitable media to reach out to the required workforce based on various factors, including vacancy type, level, and the target labour market (local, national, or industry).

When advertising the job positions, the business must apply the AIDA approach:

Attention: Gradually pay attention to the target workforce.
Interest: Generate interest and curiosity about the product.
Desire: Stimulate a desire to apply for the job
Action: Instruct potential candidates on what steps to take next, whether applying online, contacting the HR department, or attending a recruitment event.

Recruitment Code of Conduct

The HR managers must adopt ethical recruitment practices to ensure transparency and professionalism. When implementing the recruitment process, it is essential to clearly state the preferred form of reply (e.g., CV, completed application form) in job advertisements. Once the applications are received, promptly acknowledge or reply to each applicant. It is essential to establish clarity when consultants act as company forwarding agents. Inform candidates about the progress of the selection process, expected time frames, and the company’s expense policy. Comply with privacy regulations by misusing private information or altogether avoid requesting detailed personal information (e.g., religion, medical history) unless relevant to the selection process. Obtain specific approval from candidates before taking up any reference check.

Selection Strategies

In a competitive market, potential employees may have choices, emphasising the need for businesses to appeal to the right and best-fit candidates. Because of such competitive dynamics, the selection is a two-way process where the candidates can withdraw from the process or decline a job offer.

Interviews: In Australia, interviewing is a traditional and cost-effective selection process method. It is essential to utilise this method by asking open-ended questions (starting with what, why, when, which, and how) to elicit detailed information from candidates during interviews.
Non-Verbal Communication: The hospitality industry somehow depends upon the aesthetics of the workforce, especially the front-line staff. It is essential to assess body language when opting for face-to-face or virtual interviews and communication style, including fluency for telephonic interviews.
Avoid Biasness: The HR managers must make a fair and informed decision by avoiding discrimination, unconscious biases, and the ‘halo’ or ‘horns’ effect”.
Selection Techniques: The HR managers can explore the mix of alternative selection techniques beyond interviews, including tests, psychometric testing, presentations, group methods, in-tray exercises, and assessment centres.

Employee Value Proposition

The hospitality industry has transformed into a buyer’s market where the HR strategies must be aligned with the job seekers or selected candidates’ preferences, including flexible work hours, remote work opportunities, and personalised employee benefits.

Fair Pay and Incentives

Employees always aim to maximise their purchasing power because the earnings will directly impact their standard of living. They always seek a fair day’s work by comparing the current wages or salaries with their colleagues or staff from different businesses. If they are underpaid, that will lead to absenteeism or even withdrawal from employment.

HR must understand the total rewards system to retain the workforce, including basic pay and other informal rewards like tips and additional benefits. Some employees can be compensated for lower pay with food, accommodation, or medical incentives.

Training and Development

The hospitality industry is infamous for its on-the-job training and recruiting from other entities during skill or labour shortages rather than investing in existing employees. Employees are always willing and motivated to contribute actively to the business’s success if offered the right career growth opportunities. This can be in terms of training and development. The HR must take the initiative to decrease the labour turnover by opting for socialisation, development, and disciplinary initiatives.

Balanced Workplace Environment

The business must adopt HR policies that promote diversity and inclusive training, gender equality, racial equality, work-life balance, disabled employment, and age diversity to help create a positive and inclusive work environment. The workplace health and safety of the employee must include their mental and psychological needs, especially when working overtime during peak seasons. Adopting job rotations to avoid burnout is always advisable, as physical health is more important than financial need. The employee must choose whether they want to work overtime or opt for a job rotation.

Legal Compliances

The HR strategies for attracting and retaining staff predominantly depend upon the legal compliance undertaken by the business. From the recruitment stage to managing staff, if a business expeditiously complies with its legal obligation, employee turnover will decrease to a certain extent. At the beginning of employment, the employee must be given a fair work information statement and an employee handbook on various workplace policies. Apart from this, a responsible HR department must assess employees’ required licensing and certifications before hiring them, such as the Responsible Service of Alcohol. The HR must follow the State restricted trading hours, Food Safety Programs and Training, Workplace Health and Safety Regulations, Fair Work Act, and Equal Employment Opportunity, Discrimination, Bullying, and Harassment Policies.

Conclusion

A satisfied and engaged workforce becomes the cornerstone of success in an industry where service excellence is paramount. Attracting and retaining talent in the hospitality industry requires a multifaceted approach beyond traditional recruitment methods. There cannot be any universal recruitment strategies, and HR must develop strategies that cater to the needs of their business and comply with legislative requirements. As the hospitality sector continues to evolve, staying attuned to the changing expectations of the workforce and implementing innovative HR practices will be instrumental in securing and nurturing the talent essential for delivering exceptional guest experiences.