Data Collection, Regional Disparities in Opportunities, Investments are Major Challenges of Hospitality Sector, CII-EY Report
The Indian hospitality industry, which is not only an engine of growth but also a major employment provider in India, is consistently confronted with issues that inhibit the ongoing growth of the industry. A report titled ‘Navigating through the pandemic – A perspective from healthcare industry’ released by the Confederation of Indian Industry (CII) and Ernst & Young India (EY) highlights the challenges faced by this important sector. The results highlight that data collection, regional disparities, investment, and capacity building are important barriers that need urgent attention.
Challenges in Data Collection
One of the major challenges that comes out from the CII-EY report is the limited availability of data. The absence of reliable data on demand, supply and needs of the labour-market is a major obstacle for policy and planning. The industry’s estimate for national employment statistics as a result is frequently understated.Will the deeper understanding of the industry provided by official data chgange this?
Key Points from the Report:
- Data collection is hindered by informal employment, lack of standardisation among states.
- Local and seasonal differences in the hotel trade add to the complexity of the situation.
- Limited data hinders workforce planning and policy attention.
- Regional Discrepancies and Workforce Problems
- The report looks at differences in job opportunities in various areas.
- Persistent skills shortage in the labor force leads to huge salary discrepancies for career opportunities and potential for personal growth.
Productive workers such as chefs, hotel managers and travel agents command greater wages and opportunities for promotion than unproductive workers, like chambermaids and bellhops. The skill gap is also compounded by lack of soft skills, including customer service, teamwork and oral communication.
Industry Insights:
- Wage differences exist and variety exists based on the region and job prospects are limited.
- Neglect of the soft skills development stifles the career development of the workforce.
- Employment Patterns and Implications of COVID-19
Tourism and hospitality is a major employer in India. The industry employed around 80 million people and was estimated by the Government of India to contribute 15% of the nation’s GDP between 2019 to 2031. This comprises direct and indirect jobs within tourism-related activities.
But the COVID-19 pandemic hit the sector hard. Each of these crops leaves around 7.3% of all jobs in employment, which fell to around 32 million jobs in 2020-21. That being said, the sector has demonstrated an extraordinary turnaround, fuelled predominantly by domestic tourism.
Economic Impact and Recovery
The report references figures from World Travel & Tourism Council (WTTC) that bring to fore the economic impact of India’s travel and tourism economy. The industry will generate close to Rs 21,15,000 crore for the Indian economy in 2024 – a 21.3% increase from 2019. Going forward, the sector’s contribution is estimated to increase to Rs 43,25,000 crore by 2034.
Shift in Spending Patterns
Indications are that the come back of the hospitality industry has been a domestic-driven one. Local but still lekker From 2019 – 2023 domestic spend will dominate international local & travellers’ activities – suggesting spine-tingling recovery in local travel & tourism.
Addressing the Challenges
There is no single solution to challenges put forth in this report. It would involve improvement of the data collection system, reducing regional disparities, and investment in skills and capacity building.
Suggestions of CII-EY Report:
- Evidence Based Policymaking: Creating strong systems for data collection and analysis to inform better policies and investment choices.
- Statewide Standardization: Establishing standardized policies and procedures to decrease regional discrepancy and create consistent growth.\
- Training Programs: Introducing bespoke programs to plug skill gaps, especially soft skills and vocational-based training.
- Build capacity: Promote public and private investment in increased infrastructure and workforce capacity.
Hotels are at a tipping point, we can either grow or contribute to the economy. The potential of this industry can be realised with the remedial action called for in the CII -EY report, which when successful, can lead to economic replication and honest employment opportunities to millions of our countrymen. The sector will need a joint response from all stakeholders, including policy makers and industry.
References
- Confederation of Indian Industry (CII)
- Ernst & Young India (EY)
- World Travel & Tourism Council (WTTC)
