HOLLYWOOD, Florida — With hospitality in the Caribbean so dependent on international travel for demand, hotel companies operating in the region have had to adapt to the COVID-19 pandemic and the industry’s recovery from it.

Speaking during “The Evolving Business Model and What It Means for the Future” session at the 2022 Caribbean Hotel & Resort Investment Summit, hotel executives shared how their companies have evolved since the start of the pandemic and how that will continue to play out in the future.

Club Med hasn’t experienced the same staffing challenges in the Caribbean as seen in the U.S. and Canada, partly because there are fewer remote work opportunities in the region, said Eileen Kett, the company’s senior vice president, development Americas and general counsel.

Club Med has found there’s now a longer lead time when hiring to fill open positions, she said. What may have taken two to three weeks to hire 20 new people now takes two to three months.

There have been wage issues as well due to inflation and rising energy costs in Caribbean nations, Kett said. The competition isn’t driving up labor costs; rather, it’s a matter of if employees can afford to pay their bills. If wages at one job aren't enough, they’re going to find a different job that will pay them more.

“When you’re a caring company and you take care of your employees, they want to continue to work for you,” she said. “You have to pay a living wage. You have to train them. You have to invest in them.”

In the past, Club Med would change its staffing models during the low seasons, but now it won’t let go of good workers regardless of seasonal demand, Kett said. Letting go of a good employee means they might not come back. The company has looked at pre-planned vacations, training and other actions to keep employees occupied during the lower occupancy periods.

At smaller Caribbean islands, the workers generally don’t live far from their hometowns, said Javier Coll, group president of global business development for Apple Leisure Group. In countries such as the Dominican Republic or Mexico, many employees went back to their towns, and some found jobs there and didn’t come back.

Apple Leisure Group’s staff is well-trained, and the company has been promoting many of its employees and moving them to new destinations to help cover demand, Coll said. Even so, there’s still some lack in staffing, but that’s also because of the growth of all-inclusives, he said. Years ago, the brands weren’t as active in the all-inclusive resort space, but that has since changed.

“The chains are coming to the market, building new hotels or rebranding [European plan] hotels into all-inclusives, and that requires more staff,” he said.

The pandemic has shown just how important it is to be a nimble and flexible company, said Jorge Giannattasio, senior vice president, head of Caribbean and Latin American operations, at Hilton. That allowed Hilton to pivot toward its owners and relax standards and other requirements temporarily.

That also meant addressing guests’ needs, and at the start of the pandemic, the main need was making sure they felt they could travel safely, he said. Hilton addressed those with its new cleanliness protocols, giving its guests confidence to travel again.

In turn, having such a strong loyalty base helped the company rebound from the lows of the pandemic, and that was helped by its strong distribution system, he said.

Even at the start of the pandemic, it was obvious the recovery was going to be different depending on the segment, Giannattasio said. Leisure would clearly be the first segment to recover, and it did so quickly and strongly. Individual business travel was next, and Hilton has seen it return to nearly 2019 levels.

Group and convention business is coming in behind, as expected, but the segment will be back to 2019 levels by the fourth quarter of 2022 and first quarter of 2023, he said.

Sustainability is a key topic for the future of the hospitality industry, Kett said. It’s important to travelers as well as banks and investors, who are building sustainability requirements into their deals.

Citing a Booking.com report on sustainability in travel, she said 81% of travelers surveyed said they felt sustainability was an important factor in making trip decisions.

“Eighty-one percent — that’s not going to go away,” she said.

On the bank and investor side, every one of Club Med’s new projects will need to be certified by a sustainability organization or else the company will have to pay more in financing, Kett said.

“We have to build it into every project we’re doing as an industry, especially here in the Caribbean,” she said. “If there’s one region in the world that has to pay attention to sustainability initiatives, it’s got to be this one.”

While there have been good initiatives around the Caribbean, Kett said she hasn’t seen one full, regional program that’s being put into place. There isn’t even one standard by which to measure against.

Of the two types of operators, those that own and those that manage third party, those who own their properties can more easily add sustainability elements to their properties, Coll said. For third-party managers, they can add in sustainability practices to the operations, but they can only do so much with the property itself.

Apple Leisure Group has been affiliated with many institutions related to sustainability since it started, and that’s something that needs to be part of a company’s culture, mission and values, he said.

“Otherwise, it just becomes something that is very dependent on each property, which is not something that we wanted to do,” he said.

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