Labor Turnover in HK's Hospitality Industry - Essay Example

There is no denying that each manager in the hospitality industry wants to control the rate of employee turnover in order to ensure the stability of their organization. Managers have also found that hiring and training new employees cost more than retaining and promoting current employees. Employee turnover can cause bad effects, not only the cost of training and be hiring but in other areas as well. The hidden costs to the company are even greater due to bad customer service, poor brand projection, lower morale in the organization, loss of experience and lack of building a corporate legacy (Branham, 2000: 93).

The hospitality industry depends on the relationship between customers and employees, because the employee is on the front line serving the customer directly. One expert points out:‘the hospitality industry is one in which there is a high need to ensure customer loyalty as when a customer experiences good quality service, he tends to visit the same hotel again. However, if the employee turn over is fast, there is difficulty in building the customer loyalty as well as the quality of service.

’ (Marder, 2006)Sometimes even some loyal customers can be swayed to switch to a competitor’s business because a senior employee quit. In fact, this is especially true for the banquet and event services. Another problem is when senior employees, like managers or supervisors, jump to other organizations they might be disclosing some confidential information to their competitors. These techniques can range from training to recipes. The conclusion about the control the rate of employee turnover is very important due to the high rate of employee turnover impacting the delivery of efficient services in hotels and restaurants.

The trend of employee turnover should be investigated to enlighten managers about the value of retaining employees.