Drivers of Hotel Employee Retention: A Comparative Study

Abstract

The Thai economy is on the rise and the labor market is getting more competitive, partly because of the government's policy of raising minimum wage, according to a recent survey. In many ways the Philippines has achieved better progress than other developing countries. It has become industrialized nation integrated in the world economy and has somewhat moved away from agriculture. But somehow the labor turnover issues in both countries have been increasing especially in the hospitality industry. One of the most critical issue facing organizations today is how to retain the employees they want to keep. Employees retaining is the most imperative target for the organization because hiring of qualified candidate is essential for organization but their retention is more important than hiring, because a huge amount is spending on the orientation and training of the potential employees. Employee retention in the hospitality industry is a persistent problem which management can reduce by applying effective managerial and leadership practices as a means of generating employee satisfaction. Compare with other sectors where positions are mostly full-time, specialized and operate during traditional business hours, the hospitality workforce is labor intensive, and characterized by high levels of casualization diverse skill requirement from unskilled to highly specialized employees, customer contact oriented, and twenty-four hour seven days per week operation are some of the causes of high turnover. Worldwide researchers have suggested that employee turnover is among the highest in hospitality industry. When employees leave, valuable knowledge is lost and even guests may follow the departing employee. Hoteliers who have actively find ways to retain employees gain a sustainable competitive advantage. The study compares the employee retention information from the managers of selected hotels in two Southeast Asian countries, Thailand and Philippines. An empirical research is conducted to analyze and assess the best leadership practices used by hotel managers on retaining their employees. This study will lead in formulating strategies that will also contribute to the existing body of knowledge of the leadership and management practices in hotel employee retention.