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Hospitality productivity levels half those of comparable sectors

17 July 2015 by
Hospitality productivity levels half those of comparable sectors

Hospitality employees are less than half as productive as those in the likes of retail and manufacturing, according to new figures.

In response to the Treasury's productivity plan, to be released next week, analysis from People 1st has found that per employee the hospitality and tourism workforce contributes £21,600 to the economy. This compares with £46,000 per head in retail and £52,000 in manufacturing.

The People 1st Skills and Productivity Problem report calculated that an improvement in productivity of 1% would drive an additional £1.42b revenue.

People 1st managing director Simon Tarr said: "The causes of low productivity are complex and diverse. It is clear that parts of our industry are trapped in a revolving door of high turnover, increased skills gaps, and reliance on resorting to further transitional, non-permanent staff to plug those gaps. We believe diversifying recruitment to include older workers and maternity returners as well as putting in place strategies to reduce turnover with a greater focus on career progression will have a positive impact on productivity."

Tarr added that People 1st was looking to gather the views of hospitality employers to come up with a plan to tackle the issue. It has launched a consultation to garner views and will publish its recommendations in September.

Louise Smalley, group HR director of Whitbread, added: "Our sector has a great opportunity to rise to this productivity challenge. At Whitbread we've seen first-hand that making our team members aware of where skills and qualifications can take them makes a tangible difference to motivation, productivity and retention."

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