Yahoo Jobs released their 10 lowest-paying jobs for workers with college degrees. The study, found here, compares the salaries of workers in the middle of their careers. Hospitality and tourism jobs have a starting salary of $37,000 and a mid-career salary of $54,300. The worst paying jobs on the list also include drama, fine arts, education, horticulture, Spanish, music, theology, elementary education, and social work.
Category Archives: News & Notes
Consumer Reports Rates Hotels, Results May Surprise You
In the June 2010 issue of Consumer Reports, they have a special travel section that tells readers how to get great deals on travel. They also announce their ratings for the year. The hotel ratings, based on over 27,000 reader’s surveys, are somewhat surprising. Consumer Reports has odd categories of hotels such as ‘fanciest’, ‘luxury’, and ‘upscale’. The ‘upscale’ category for instance has both full-service and limited-service hotels.
The top score was a tie between Ritz-Carlton in the ‘fanciest’ category and Homewood Suites in the ‘upscale’ category. The Homewood Suites scored an excellent in value and the Ritz scored very good.
Here are the rankings for a couple of the categories:
USA Today reports ‘Hard Times Send Hotel Industry into Survival Mode’
A really good article from USA Today about hotels struggling to survive. Check out the full article on USA Today’s website.
The article features some high-profile hotel closures such as the W Hotel in San Diego and the Ritz-Carlton in Las Vegas. The article also mentions how 76 California hotels have already fallen into foreclosure and that 330 out of the states 10,000 hotels have defaulted on their mortgage payments in the last year.
As far as the cuts, the article really only mentions that Concierges are being replaced by lower-cost employees and some hotels are changing their approach to food and beverage.
We have noticed quite a few changes at hotels over the last year or so to cut costs or drive revenues. A few of the changes we see:
- Many hotels have closed restaurants and bars. Instead of having 2 or 3, many have closed all but one restaurant and one bar.
- Hotels have cut costs and gone green by eliminating newspapers and printed folios.
- Parking rates are on the rise. Many hotels have increased the parking fees for both self-parking and valet parking.
- Breakfast buffets have really been changing. The prices have increased and the quality and selection of food have decreased.
- Overall staffing has really decreased. Many hotels have eliminated positions like bellmen or concierges. Also, we see longer lines at check-in because the hotels have fewer GSAs with similar occupancy as in the past.
What are you doing to survive? Please post in our comment section!
Hilton to Devalue Honors Points in 2010
Hilton is taking a lot of heat after announcing they will change the number of points required to book a free night stay, essentially devaluing their Hilton Honors points by about 20 percent. Check out the full USA Today article and the nasty comments, here.
Our take: We agree with the travel industry analyst who said ‘it is absolutely the wrong decision to make at a time when hotel demand is down from corporate business, conferences, and leisure.” It will save cash, but the timing is very poor.
In a follow-up post, found here, three other brands seemed to distance themselves from Hilton’s strategy.
Our favorite comment was from IHG’s Jim Abrahamson who said that rewards members are twice as profitable and elite-level members are 12 times as profitable. He goes on to say “if one platinum-level member leaves us, we’d have to go out and find 12 new customers just to replace that one.”
UC Berkeley Economist Predicts ‘As Many As 1 in 5 U.S. Hotels May Default’
Good article today in the LA Times titled ‘Hotel defaults, foreclosures rise in California’. The article says that more than 300 hotels in California were in foreclosure or default as of September 30th, 2009. In Southern California alone, there are 140 hotels in default or foreclosure. The main problem is that many hotel loans were expected to be repaid within 5 or 10 years and were financed at the peak of the market. The author also blames loose lending and irrational exuberance.
Smith Travel Research is predicting no significant improvement for the hotel industry until 2011 at the earliest.
23 Story Hilton Hotel to Shut Down For 4 Weeks to Save Money
A Hilton Hotel in Portland, Oregon is preparing to shut down for 4 weeks to save money. The hotel is the largest in the state of Oregon. The hotel consists of two different towers located across the street from each other. One of the towers will remain open. The story was originally reported in the Oregonian and can be found here.
Our take: This story has been picked up by many news outlets and is being used to show how badly hotels are hurting. The main problem in that area is the 500 new hotel rooms that opened recently. We think the hotel is just being smart and planning ahead. Even in good times, many hotels close floors or even entire towers for weeks or months at a time. Closing floors can save a lot of money on cleaning and energy costs if the demand for the rooms is not there.
The story does a good job of reminding us all to take a look at our upcoming forecasts. Do we have an opportunity to close floors and reduce costs?
Marriott, Starwood, & Wyndham Scale Back Time-Share Business
The Wall Street Journal is reporting that the major time-share developers are scaling back their time-share business as they are going through some pretty tough times. Investors are demanding higher interest rates and buyers are becoming more and more scarce. Also, a higher percentage of time-share-backed loan securities are becoming delinquent each month.
Our take: Good news for hotels. Time-shares have been popping up everywhere in the last 10 years and have really overbuilt in many vacation destinations causing too much competition. While customer satisfaction has really improved with time-shares, they are still one of the most expensive ways to take a vacation. Time-shares tend to lose 80 percent of their value the day you buy one.
Have a time-share and disagree? Post your comments below.
California to See a Record Number of Hotel Foreclosures
According to an article by Alan X. Reay that appears on hotelnewsnow.com, the number of CA hotels in default or foreclosed on jumped 125 percent in the last 60 days and the state now has 31 hotels that have been foreclosed on and 175 in default. Not surprisingly about 87 percent of the hotels in default are non-franchised hotels. Also, 75 percent of the hotels that are in default were either purchased or refinanced between 2005 and 2007.
The author estimates that hotel values are currently 50-80% lower than the peak as a result of declining revenues.
WSJ Catches Hotels Piling on Fees
In a new article posted on the Wall Street Journal’s website, the author catches hotels piling on extra fees to make up for a loss in room revenue. Some of the fees that they have found are mandatory valet parking fees, increased resort fees, housekeeping and bellman mandatory gratuities, and other fees such as a mandatory fee for in-room safes.
Should you be adding fees like these to make up for a loss in room revenues? Absolutely not.
First off, mandatory fees are often illegal. The article describes how Wyndham Worldwide and Marriott were sued and settled with Florida’s Attorney General over adding mandatory surcharges. The Florida AG also has six ongoing investigations. Undisclosed energy surcharges (we all remember those) and in-room safe fees are among the issues being investigated.
Extended Stay Hotels File for Bankruptcy
Extended Stay Hotels has more than 680 properties under brands like Extended Stay America and Homestead Studio Suites.
Bloomberg is reporting that they filed bankruptcy on June 15th because they are ‘significantly over-leveraged and the projected cash flows cannot continue to service over $7 billion in debt’. Extended Stay Hotels employs about 10,000 people.