As tourists opt for staycations and business travelers trade smart casual for their “Zoom shirts,” hotels and convention centers are feeling the pain of their absence. The continued spread of COVID-19 is convincing would-be-vacationers and conference-goers to stay home, and has disrupted the hospitality industry to the point that investors and CEOs fear for what’s next.
In his latest appearance on Bloomberg, Starwood Capital Group founder Barry Sternlicht predicted a third of hotels in New York City could go bankrupt. Hilton CEO Christopher Nassetta has been in the industry for 35 years and told Travel Weekly “[I’ve] never seen anything like it. The bulk of our hotels in the major cities are closing as we speak.” And according to the Hotel and Lodging Association, 7.7 million hospitality and leisure jobs were lost in April alone. In a nutshell, and in line with most things 2020, industry prospects are looking pretty bleak.
With decreased demand have come fewer job opportunities. On March 1, Hilton Hotel and Resorts ($NYSE:HLT) had 4,030 online job listings; by July 6, listings had dropped by an astonishing 86%, leaving only 572 up for grabs. A similar story can be told about Marriott International ($NASDAQ:MAR), which had a whopping 12,500 listings as of March 1 and only 1,720 on July 6, and Hyatt Hotels ($NYSE:H), which slashed their 1,780 listings on March 1 by over a thousand, leaving just 728 on July 6.
Across the board, the industry has also delayed building projects. Data from Top Hotel News shows Hilton postponed 85 projects and canceled 14 as of April 30; Marriott postponed 126 and canceled 38 as of the same date; Wyndham Worldwide ($NYSE:WYN) postponed 15 and canceled 8 projects as of May 13; and Intercontinental Hotel Group ($NYSE:IHG) postponed 51 and canceled 9 as of the same date. Hyatt has fared a bit better on the project front, only having to delay eight projects and cancel three as of May 13, but is still feeling the sting of lost revenue.
While most hotel chains are suffering losses like never before, many are still trying to step up during this time of need. Both Hilton and Marriott donated thousands of dollars and hotel rooms to support first responders in their effort to curb the coronavirus crisis. Hyatt teamed up with American Airlines ($NASDAQ:AAL) to offer NYC first responders complimentary three-night vacations. Hilton seems to have reaped the majority of the benefit from such moves, as its Facebook "Talking About" counts jumped as high as 275% in June. Hyatt also saw a bump at the end of July while it seems like Facebook users have stopped talking about Marriott entirely. These acts of kindness will serve as reputation lifelines as the brands’ social presence continues to ebb and flow. At least we can scroll through their feeds until the day we put on some real clothes and head on vacation again.