Employee Turnover In The Australian Hospitality Industry: Causes, Impacts, And Solutions

Background and Rationale

Discuss About The Employee Turnover Currently Reaching Crisis.

The principal intent of this research study remains in exploring the element of staff turnover rates in the Australian hospitality sector within a section of hotel chains in the country. The researcher therefore acknowledges that resource constraints such as time challenged the study in examining several hotels in Australia, efforts that would have helped in generalizing the findings of this study. The aim of this chapter remains to provided an outline on the research study. The research paper will be disintegrated into six sections. The first section will provide a brief background of the study as well as its rationale. In the second part, the researcher will provide a prescription of the research studies problem, an aspect that will be followed by the studies aim and objectives. The next section will give a description of the studies research methods and questions. The core of the study will be protracted from the contributions of other literatures in the literature review section in which the structure of the research as well as its relationship with other subsequent chapters will be provided followed by a summary of the research study. Staff turnover therefore remains a vital subject for executives and organizations in the Australian hospitality sector since staffs are observed as assets and pillars to an organization and the failure to establish methods of retaining them would result in turnover, an aspect that costs organizations a considerable amount of money. According to Deery & Shaw (2008), employees make considerable inputs to the organizations they work for in regards to skills, abilities, and knowledge, an aspect that aid the hospitality industry to gain a competitive advantage in the industry.  This therefore denotes the need to address this issue, positing the intent of this paper.

The hospitality industry in Australia according is one of the largest and the most expanding industries in the world, an aspect that has seen hotels viewed as the ingredients of globalization since they provide homage to tourists and business personnel’s from different regions of the world. Research studies on the hospitality industry in Australia revealed that the workforces in the hotels are insecure, unskilled, and possess limited language skills (Gallardo wt al, 2010). The research studies revealed that the labour force in the Australian hotel sector mainly encompasses a section of casual workers lacking the required perpetual labour contracts, thus pointing to the fact that they receive limited wages and their job openings require minimal or no occupational training or formal education hence the low wages (Iverson & Deery, 2008). Moreover, studies have revealed that the hotel industry in Australia is faced with higher gender imbalances, with ladies covering 62% of the industry as equated to 40% in the other different industries, with a limited number of this population slated for the managerial levels. Several of the working populations are mainly young people, with a majority of this populace considered as migrants. Lastly, the hotel industry in Australia is subjected to higher levels of labour intensity with minimal wages; no doubt the industry has a higher turnover rate.

Problem Statement

The hospitality industry delivers numerous occupations around the world and contributes broadly to GDPs (Gross Domestic Products) (Rishi & Gaur, 2012). This exposition contemplates investigated representative turnover in the hospitality business and concentrated on the reasons why such a large number of workers withdraw from the business and how to diminish the turnover. The workers turnover rate is exceedingly taking off, remaining at more than 37% every year in the hospitality business (Australian Bureau of Labour Statistics, 2013). The Bureau of Labour Statistics demonstrated the month to month turnover rate to bring down in different businesses like construction, education and retail. Hall noted 75% of labourers leave hospitality following a half year, 53% following one year and just 12% stay following three years (Hall, 2010).

The retention of employees remains a major challenge in the hospitality industry in Australia given the growth of expansion in the service industry as well as the related costs involved in the development of the workforce. Research has revealed that rates of turnover are a significant challenge in the sector given that the hospitality sector in Australia is considered to have a higher turnover as associated with other industries. Employees therefore serve as human resource and equally play substantial roles in the sector given that the sector relies to a larger extent on the services provided by workers (Marren and Kennedy, 2010). This therefore poses a problem for managers and organizations, probing the need for approaches of minimizing turnover. Business turnover-detachment without a doubt influences industry income alongside monetary development, regardless of whether broadly, provincially, or comprehensively. Keeping workers in the business is fundamental to accomplishing retention. The lack of retention of employees can be costly for a firm. It shows low morale among the employees and it leads to low productivity. The role of a workforce in any organisation cannot be stressed enough. They are the backbone of the company. Dysvik and Kuvaas communicated that tourism industry should step toward in lessening turnover rates immediately and keep searching for techniques to address this occurrence in Australia (Dysvik and Kuvaas, 2010).

The tourism industry in Australia additionally needs to discover approaches to urge representatives to remain in that capacity a high turnover rate may demoralize great workers from remaining. Holding workers is central to the accommodation segment and accomplishing a higher standard for dependability involves a successful administrative activity. The hospitality business is a work-intense industry and labourers may have low confidence, low sense of pride, and an unfortunate perspective of bosses. Such a negative view or disillusionment brings about bothering between labourers which can make them leave (Walsh and Taylor, 2007). In lieu of this, the study seeks to examine the effects of turnover rates in the tourism industry in Australia.

Aim and Objectives

The was aim of this research is to investigate the reasons and factors that cause employees to depart their job in hospitality industry and the impact of high turnover in the Hospitality business and purposed the methodologies to reduce turnover. The objectives of this examination are to:

• Determine the current rate of turnover;
• Examine the factors that influence the turnover of workers in the hospitality industry, and;
• Develop strategies to decrease the turnover in the hospitality industry

Research Question

1. What are the possible reasons and causative factors for the increasing staff turnover rates and levels in the Australian hospitality sector?

This documented report is of significance since it calls attention to critical factors that lead to high employee turnover in the Australian hospitality industry. It provides insight, knowledge, skills as well as possible solutions to various stakeholders in the industry to mitigate the myriad of issues leading to employee departure. The theoretical concepts outlined in this paper are fashioned to explain and advance knowledge pertaining the maintenance and management of the proper staffing levels in the industry. In practice this concepts can be used to invest in training, offering support, career advancement opportunities and reward incentives to the workforce. Such offerings constitute some of the most fundamental aspects expected to retain employees in an organization.

In this section, the researcher will conduct a literature review from appropriate primary and secondary sources. The collected data will then be evaluated to draw an understanding of the research subject, an aspect that will provide more insights into staff turnover rates in the Australian hospitality industry.

Figure 1.1: Conceptual Framework (Source: Created by the Researcher)

Labour force and shortages in skills are considered as the most trivial challenges facing the Australian hospitality industry. With the increasing resource boom driving the aspect of demand for workers, the raising pace of retirement, the increasing migrant numbers, and the constraints experienced in the labour market increasingly turning out as a challenge, a heightened rate of staff turnover remains eminent in the hospitality industry. Within the Australian tourism industry, skills and labour challenges have inhibited immense pressures, thus impacting the performance of the industry. According to Kuvaas & Dysvik (2010), employee turnover is a process in which employees or staff members leave a hotel and their position has to be filled, an aspect that is injurious to an organization. Some employees leave for various reasons, with some including the quest for better opportunities, death, lower salaries, and the pursuit for education. Staff turnover in the Australian industry has turned out to be a field of interest to several research studies. Vasquez, Noriega, Pender & Kasen (2014) states that several research studies have mainly focused on job retention, with evidence proving that satisfaction in a staff member’s current job is a key factor in their choice to remain in an organization. In other words, the more employees get satisfaction in their jobs, the lesser their intention remains in leaving their job positions in search for others.

Justification and potential output of the research project

Allen, Shore & Griffeth (2003) and Bonn (2002) purport that salary remains a motivator that grants staff members recognition for the efforts they put in a company, an aspect that encourages the members of staff concentrate and perform better. In this regard, it is essential to note that incentive schemes are considered as additional compensation provided to employees with the sole objective of motivating them as valuable staff members, efforts that enable them to stay put in a company. Cairncross & Buultjens (2007) also stress that binding incentive schemes and salaries may be a better approach of increasing the performance of employees, citing this as one of the reasons why employees leave hotels that fail to compensate them well. According to Cairncross & Buultjens (2007), employers in the tourism industry in Australia may need to initiate more approaches aimed at compensating potential employees as an approach aimed at retaining them within the industry. The inclusion of incentive schemes would enable employees to take interest in their jobs and work efficiently towards meeting an organizations goal.

On the other hand, it is evident that most hotels are known for extending their working hours especially during peak seasons in an effort to heighten their productivity through double shifts. Barron, Maxwell, Broadbridge, & Ogden (2007) states that hotels have not established or defined their working hours since customers need services any time. Besides this, employees are forced to work on more allotted shifts with minimal pays. The extension of working hours therefore affects employee turnover, forcing more employees to seek for other job opportunities that provide favourable working hours. It is in this case necessary to note that long working shifts tend to be disastrous to the health and well-being of employees besides its effects of their physical exhaustion as well as mental exhaustion, thus affecting the quality of work delivered (Barron et al, 2007). This therefore results in poor performances, forcing employees to leave since they are not in a position to bear with the emanating pressures in the industry.

To accurately assess the different factors causing turnover in hospitality industry in Australia and to develop strategies to reduce the turnover, this study has chosen qualitative methodology to conduct this study. As established, research studies may either take the quantitative or qualitative forms. This study however relies in the qualitative method. The qualitative research method is designed to help researchers gain in-depth insights on staff turnover in the Australian hospitality industry, efforts aimed at understanding human behavior in the making of decisions. The qualitative methodology remains appropriate for this study given that it will allow the researcher to delve deep into finding the answers to the studies research questions. Bryman (2012) adduces that qualitative research method helps in examining specific cases in greater depth, thus siting the need for the inclusion of this method.

Theoretical Framework

On the other hand, Bryman (2012) alleges that qualitative research method primarily focus on words as opposed to quantifications in the collection of data, efforts that help in adducing the relationships between a study and its theory. It is evident that interviews remain the main instrument used in the collection of data in a qualitative study, therefore establishing the fact that this study will deploy the usage of surveys as well as interviews in the collection of data. In regards to the labor turnover rates literature as well as industrial panels, an online survey will be designed and distributed to five star hotels in Australia, an aspect that will result in the interviewing of 30 Human Resource Managers in the industry and 12 employees, thus providing a representative response and sample of 30 percent. Given the way that there are high turnover and worker turnover impacts affect employee and business in the hospitality industry in Australia. The literature review section will adduce its sources from peer-reviewed journals, dissertation studies, government data and other relevant publically available data relating to the topic.

This study used secondary data form different sources like peer-reviewed journals, data from Australian Bureau of Statistics database, and different other online sources such as research published in the same field and credible online websites addressing the same topic. Various peer-reviewed articles were dedicated to the employee turnover in the hospitality industry in Australia and approaches need to execute keeping in mind the end goal to diminish turnover (Neuman, 2014). After collecting all the data and information for this study, different factors affecting turnover will be identified, and impact of those factor on employee turnover will be examine, and interpretation of patterns and themes in data and information will be done and will be determining how these patterns and themes helps to understand the high turnover, and finally develops strategies to decrease the turnover in the hospitality industry in Australia.

Sampling Method: Unlike the qualitative research method in which a random sampling method remains a common phenomenon, this study will utilize the purposive sampling method. Purposive sampling in this case allows the researcher to choose his participants relevantly in order to address the research studies intent (Neuman, 2014). The researcher in this case will sample information from two groups: the employees and managers, from a group of three five star hotels in Australia.

Data Analysis:  For the purpose of the study, secondary data from the government and industry sources and data from different online sources will be used. The data analysis method will be based on the need to understand the concepts and themes examined in the data. According Neumann (2014), concepts are established to provide responses to research questions before an analysis is conducted. This therefore denotes the need for a coding approach in analyzing a qualitative study, an approach that entails the process of organizing the collected raw data in themes and categories in an effort to derive a concept.

The coding process takes three forms, an open-coding process in which the collected data is lined into categories for an examination to find the relevant themes, the axial coding approach in which researchers concentrate on the concepts and categories and compares each of the categories to find possible connections, and the selective coding method in which data is accrued to support the developed categories (Neuman, 2014)This study will therefore combine the three methods of coding together given that the respondents originate from different organizations with different managerial styles, thus denoting the need to analyze them selectively before linking them together.

The five star hotels and residential accommodation facilities are a significant force behind the employment of labor and operate in a volatile and competitive market. The study revealed that one of the significant approaches of determining the performance of the industry remains in gauging the efficiency of the sector through the attraction and retention of employees. The data therefore revealed that the industry is faced by a an annual turnover rate of close to 50.64% among operational employees, thus suggesting a predictable pattern pf an increasing turnover rate in the housekeeping, restaurant, bar, front office, and the kitchen; considered as the largest units of employers within the industry (Australian Tourism Labour Force Report 2011). It is additionally essential to establish that the study found out that the rate of turnover among the executives, departmental managers, and supervisions stood at 40.05%, higher than the expected levels.  Given this, it is essential to note that the levels of turnover imply that both the operational employees and managers are likely to possess similar experiences within the sector given the fact that similar reasons cause the higher turnover rates. For instance, it was evident that the employees at all the levels of employment mostly left because of low salaries, wages, the quest for better opportunities, job stresses, and extended working durations.

Secondly, the study revealed that labor turnover remains greatest in the remote and regional hotels in Australia as compared to hotels around the city, with this attributed to poor working conditions, isolation, and distance (Faldetta, Fasone & Provenzano, 2013). This has therefore made the attraction and retention of employees a challenge within the sector. As established in the collected data, the primary rationale for operational staffs and manager’s turnover was based on low salaries and wages, job stresses, extended working conditions, and the pursuit for better opportunities, causing voluntary resignations (Carbery, Garavan, O’Brien, & McDonnell, 2003). On the other hand, performance related resignations or termination were slightly lower, with the main motivation for the change of jobs among the staffs and managers in the Australian hospitality industry attributed to the quest for better career opportunities and flexible working hours. Changing jobs to other industries is in this case motivated by better career paths, higher salaries, and flexible working hours. The data therefore suggests that better working conditions and higher wages are the main drivers of employees and managers leave.

Employees make considerable inputs to the organizations they work for in regards to skills, abilities, and knowledge, an aspect that aid the hospitality industry to gain a competitive advantage in the industry, positing the intent of this paper. In an effort to draw an in-depth understanding on this subject, the research study was broken down into different sections. The first section will provided a brief background of the study as well as its rationale. In the second part, the researcher gave a prescription of the research studies problem, an aspect that was followed by the studies aim and objectives. The next section gave a description of the studies research methods and questions. The core of the study was protracted from the contributions of other literatures in the literature review section in which the structure of the research as well as its relationship with other subsequent chapters will be provided followed by a summary of the research study. The study therefore revealed that staff turnover rates remains a vital subject for executives and organizations in the Australian hospitality sector since staffs are regarded as assets and vital resources to organizations and the failure to establish methods of retaining them would result in turnover, an aspect that costs organizations a considerable amount of money. As established in the collected data, the primary rationale for operational staffs and manager’s turnover was based on low salaries and wages, job stresses, extended working conditions, and the pursuit for better opportunities, causing voluntary resignations.

Conclusion

As projected in this research study, employee turnover is currently reaching a crisis proportion for organizations in the tourism industry that are struggling to maintain proper and effective staffing levels in the competitive labour market. Turnover in several cases has been utilized as a measure of an organization or industries performance, an aspect that remains expensive in regards to operational and financial efficiency. Labour force and shortages in skills are considered as the most trivial challenges facing the Australian hospitality industry. With the increasing resource boom driving the aspect of demand for workers, the raising pace of retirement, the increasing migrant numbers, and the constraints experienced in the labour market increasingly turning out as a challenge, a heightened rate of staff turnover remains eminent in the hospitality industry.  The primary rationale for operational staffs and manager’s turnover was based on low salaries and wages, job stresses, extended working conditions, and the pursuit for better opportunities, causing voluntary resignations. It is therefore crucial for employers in the tourism industry in Australia to initiate more approaches aimed at compensating potential employees, repealing their working hours, and harnessing their skills through development and training as an approach aimed at retaining them within the industry. The inclusion of these measures would enable employees to take interest in their jobs and work efficiently towards meeting an organizations goal.

References

Allen, D., Shore, L.M., Griffeth, R.W. (2003). The Role of Perceived Organizational Support and Supportive Human Resource Practices in The Turnover Process. Journal of Management, 29 (1) 99-118.

Australian Bureau of Statistics, Australian Government. (n.d.). Retrieved April 06, 2018, from https://www.abs.gov.au/

Australian Tourism Labour Force Report (2011). Australian Tour?sm Labour Force Report Labour Force Profile (Part 1), Deloitte Access Economics.

Barron, P., Maxwell, G., Broadbridge, A., Ogden, S. (2007), Careers in Hospitality Management: Generation Y’s Experiences and Perceptions. Journal of Hospitality and Tourism Management, 14 (2): 119-128.

Bonn, M.A., Forbringer, L. (2002) Reducing Turnover in The Hospitality Industry: An Overview of Recruitment, Selection and Retention. International Journal of Contemporary Hospitality Management, 11(1), 47-63.

Bryant, A. (2012). Social Research Methods (4th Ed.). Oxford University Press Inc., NY.

Cairncross, G., Buultjens, J. (2007), Generation Y and Work in The Tourism and Hospitality Industry: Problem? What problem? Occasional paper No. 9, Centre for Enterprise Development and Research, Southern Cross University, Tweed Heads, Australia.

Carbery, R, Garavan, T.N., O’Brien, & McDonnell, J. (2003). Predicting Hotel Managers’ Turnover Cognitions. Journal of Managerial Psychology, 18 (7): 649-679.

Deery, & Shaw. (1997). An exploratory analysis of turnover culture in the hotel industry in Australia. International Journal of Hospitality Management, 16(4), 375-392.

Drew, Vlahovich, Hughes, Appaneal, Peterson, Burke, . . . Waddington. (2017). Stay healthy: Project outline, methodology and approach. Journal of Science and Medicine in Sport, 20, E79.

Faldetta, G., Fasone, V., Provenzano, C. (2013). Turnover in the Hospitality Industry: Can Reciprocity Solve the Problem. Revista de Turismo y Patrimonio Cultural, 11(4):583-595.

Gallardo, E., Sánchez-Ca?izares, S.M., Lôpez-Guzmán, T., Jesus, M.M.N. (2010). Employee Satisfaction in The Iberian Hotel Industry The Case of Andalusia (Spain) and The Algarve (Portugal). International Journal of Contemporary Hospitality Management, 22 (3): 321-334.

Hall, C. M. (2010). Crisis events in tourism: subjects of crisis in tourism. Current issues in Tourism, 13(5), 401-417.

Hu, H.H.S., Cheng, C.W. (2010). Job Stress, Coping Strategies, and Burnout Among Hotel Industry Supervisors in Taiwan. The International Journal of Human Resource Management, 21 (8): 1337-1350.

Iverson, R., & Deery, M. (1997). Turnover culture in the hospitality industry. Human Resource Management Journal, 7(4), 71-82.

Kuvaas, B., & Dysvik, A. (2010). Does best practice HRM only work for intrinsically motivated employees? The International Journal of Human Resource Management, 21(13), 2339-2357.

Kuvaas, B., & Dysvik, A. (2010). Exploring alternative relationships between perceived investment in employee development, perceived supervisor support and employee outcomes. Human Resource Management Journal, 20(2), 138-156.

Marren, P. B., & Kennedy Jr, P. J. (2010). Scenario planning for economic recovery: short-term decision making in a recession. Strategy & Leadership, 38(1), 11-16.

Neuman, W. L. (2014). Social research method: Qualitative and quantitative approaches (7 th ed.). Boston. Pearson Education, Inc.

Neuman, W. L. (2014). Understanding research. University of Wisconsin at Whitewater. Pearson Education, Inc.

Rishi, M., & Gaur, S. S. (2012). Emerging sales and marketing challenges in the global hospitality industry: A thematic analysis of customer reviews from the world’s top two tourist destinations. Worldwide Hospitality and Tourism Themes, 4(2), 131-149.

Vasquez, D., Noriega, Pender, & Kasen, Patsy. (2014). Employee Turnover in the Hospitality Industry: A Qualitative Phenomenological Study, ProQuest Dissertations and Theses.

Walsh, K., & Taylor, M. S. (2007). Developing in-house careers and retaining management talent: What hospitality professionals want from their jobs. Cornell Hotel and Restaurant Administration Quarterly, 48(2), 163-182.

Wilkins, R., & Wooden, M. (2014). Two decades of change: the Australian labour market, 1993–2013. Australian Economic Review, 47(4), 417-431.

Order an Essay Now & Get These Features For Free:

Turnitin Report

Formatting

Title Page

Citation

Outline

Place an Order