Call for government aid package as hotel industry in ‘complete freefall’

The hotel industry is expected to lay off around 70,000 employees in the next 12 weeks, as the coronavirus shutdown kicks in.

Speaking to The Australian Financial Review, Accommodation Association of Australia chief executive Dean Long said the sector is in “complete freefall”.

“There are major job losses, about 50,000, coming off the boil in the next 14 days and more in the coming months,” he said.

Occupancy levels of hotels across the country have fallen to between 10 and 20 per cent, compared with a three-year average of about 80 per cent for this time of year. They are expected to fall below 10 per cent in the coming weeks.

Long said the government’s current relief funding is targeted at small and medium businesses, but offers nothing for the larger international chains that employ most of the accommodation workforce in Australia’s capital cities.

“The big end of town employ the overwhelming majority of people in the accommodation industry, and that’s our main concern with today’s package,” he said. “It doesn’t help the companies actually employing Australians and they are the ones with less than three months to go.”

Hilton directly employ around 2000 people in Australia. Heidi Kunkel, Hilton’s vice-president of operations for Australasia, has called on the federal government to pull together an aid package for the industry.

“Ours is an industry of people serving people, and that’s why we’re asking the Australian federal government for urgent support … through this very challenging time,” Kunkel told the AFR.

Tourism and hotel industry groups have called for 50 per cent of its PAYG payments from the previous year to be refunded, totalling about $700 million.

Accor is Australia’s largest hotel operator with 21,000 employees, with the group’s local boss Simon McGrath warning the long-term impact of the shutdown “will be costly” with owners closing hotels in the coming week to control cashflow.

“We are seeing staff so willing, trying so hard under these conditions, caring for people, and yet knowing the reality of shortfalls in occupancies each day,” he told the AFR.