The Hospitality Outlook for 2022

from SCV Business Journal May 2022

by Signal

A Weekend Full of Local Hidden Gems

MAY 2022

SANTA CLARITA VALLEY BUSINESS JOURNAL · 7

The Hospitality Outlook for 2022

BY MARK LEE AND KIM GORE

Contributing to the Business Journal

Restaurants and hotels have had to become creative in responding to the pandemic as they worked to strengthen safeguards to protect workers and customers. And, their resourcefulness has paid off.

For hospitality businesses, it has been daunting to navigate through a global pandemic. The issues that caused such a downturn are still hurting the industry: Labor shortages abound at restaurants and hotels. Business travel remains substantially below 2019 levels. Increased reliance on technology has helped improve operations but increased cyber risk. The delta variant of COVID-19 has resulted in a return to indoor mask mandates in many areas.

These issues have had a tangible effect on risk management and insurance. Underwriters are making more on-site inspections, while checking social media reviews of hospitality businesses to check for risk.

Insurers are closely looking at restaurants’ ability to deal with rising alcohol sales and determining if hotels are taking full measures to combat COVID-19, as many promote staycations to boost occupancy.

However, creative solutions that include technology, marketing and enhanced employee benefits can have a major positive impact on the hospitality industry — as long as owners and operators are cognizant of and have the ability to manage the risks.

What to Expect in 2022

Even with a huge number of vacant positions, protecting employees will remain the risk management priority. Hospitality businesses will improve working conditions to attract workers and reduce risk.

The industry will offer higher pay, improved benefits and better working conditions.

The worker shortages that have hurt the industry since the outset of the pandemic aren’t abating. A third of former hospitality workers won’t consider returning to the industry.

See HOSPITALITY, page 28