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New report reveals the pandemic's impact on Australia's hospitality industry & what the road to recovery entails

New report reveals the pandemic's impact on Australia's hospitality industry & what the road to recovery entails

Research finds bars and pubs hit hardest and are now gearing up for a post-pandemic boom

SYDNEY – November 11, 2021 – A new report from the leading shift work platform, Deputy, Staying Open: Future-Proofing Aussie Hospitality showcases the long-lasting impact the pandemic has had on the hospitality industry, how it’s fairing today and the challenges and opportunities it faces in the near future. The report features an analysis of over 12 million shifts between January 2020 - October 2021, comparing them by generation, age, state and industry sector. 

The report finds the hospitality industry has been transformed by the pandemic after experiencing an 80% decrease in shift-work hours in April 2020. Since then, hospitality businesses have rostered on average 30% fewer shift work hours compared to pre-pandemic operations. Bars and pubs were most significantly impacted by Covid-19, with shift-work hours declining more than 90% in April 2020, and while some states have fared better, lockdowns in New South Wales and Victoria meant they operated at half their employment capacity in 2021.

On the other end of the spectrum, the report found cafes and coffee shops, which were able to pivot quickly, thrived throughout the pandemic. In these sectors, shift work hours have continued to improve and remained significantly higher than employment levels before the pandemic. Similarly, restaurants went from operating 80% below pre-pandemic levels in April 2020 to 80% above these levels in May 2021. This recovery is credited to minimal restrictions in this time and the domestic travel boom. That being said, these gains have been scuttled by the recent 2021 lockdowns in Sydney and Melbourne, which have particularly affected inner-city restaurants in these major cities. 

Additional impacts of the pandemic to the hospitality industry outlined in the report include:

  • Locked-down states hit the worst: Victoria, New South Wales and Australian Capital Territory employed half the number of shift workers compared to the pre-pandemic levels in September 2021. Queensland, Western Australia, South Australia and Northern Territory have seen an increased amount of shift work hours exceeding pre-pandemic levels of employment. This has been driven by less exposure to restrictions and a domestic tourism boom.
  • Women are more likely to miss out on shifts: Women across all age groups have been hit the hardest by Covid-19 and the economic crisis. They experienced an additional -1.2% decline in shift work hours, compared to men. Women were also more likely to be casual workers with less than one year tenure and therefore less likely to receive financial support via JobSeeker and JobKeeper.
  • Baby boomers choose early retirement: Baby boomers were least financially affected by Covid-19 restrictions according to the 2021 Pulse of the Nation Survey. However, Baby Boomers were the most affected by the decline in shift work hours, with a decline of 3.6% in shift work hours compared to their peers. As a result, many exited the workforce, some for early retirement.

However, as a result of lockdowns easing, the hospitality industry saw a 52% increase in shift hours worked in October compared to September. The industry is now experiencing an injection of consumer spending. Australians have accumulated more than $200 billion in household savings as a result of international travel bans and other restrictions. With cities opening up, people have never been more inclined to spend money at their favourite restaurants, venues, bars and pubs. 

The report has been created in partnership with labour economist Shashi Karu who predicts that like the Spanish Flu, which saw the introduction of sick leave, the Covid-19 pandemic will open a new chapter of reforms and benefits for the shift workers of the hospitality industry. He says, “We can expect a silver lining from Covid-19 to be the introduction of reforms to childcare, wages and job security. As the industry faces a worker shortage due to border closures, business owners will need to find ways to entice talent as competition will be fierce. The result of this will be shift-workers having more bargaining power than previously seen in the industry.”

The report predicts the top challenges and opportunities facing the hospitality industry are: 

  • Businesses will battle it out for the best talent: There is set to be critical worker shortages in the hospitality sector as it aims to fill 140,000 new jobs in the next five years. The competition to attract and retain talent will be unprecedented and the worker will have more bargaining power than previously seen in the industry. This will result in higher wages and more secure working conditions especially for women, Gen Zs, Baby Boomers and people with disabilities.
  • Local communities will be revitalised: Remote working in residential neighbourhoods has renewed support for nearby community spaces – including local hospitality venues. This trend will support spending on local food and entertainment opportunities such as local shopping centres, retail strips and neighbourhood pubs and bars. Inner-city Sydney and Melbourne will be permanently impacted due to the exit or reduction of remote workers and office spaces.
  • Technology in the workplace: The hospitality sector will embrace working with technology to help overcome the labour shortage. By using technology to properly and easily manage back-end business operations, hospitality workers can focus on delivering the human connection and customer experience that’s most important.
  • Local tourism boost: With international borders reopening, a boom in tourism will likely support the recovery of hospitality operators in the near term. Furthermore, government interventions to stimulate the domestic tourism industry are likely to benefit the hospitality industry, particularly accommodation providers, regional Australian businesses and destination dining venues.

Ashik Ahmed, CEO & Co-Founder of Deputy states, “It’s been incredible to see the huge transformation that the hospitality industry has undergone as a result of the pandemic. While it has had a devastating impact on a lot of businesses, watching the resilience of many of our customers as they embrace change and innovate is inspiring. 
As we look ahead, the hospitality industry is set to face a range of challenges as it navigates vaccination passports, workforce shortages, up-skilling and the adoption of technology in the workplace. However, I remain optimistic that as a result of Covid-19, we will see necessary industry reforms for shift workers, including around better childcare, more secure jobs and benefits.”

About the research: 

The Staying Open: Future-Proofing Aussie Hospitality report was produced by leading scheduling software platform, Deputy, utilising Deputy customer data. The report features an industry-focused data analysis of Australian shift workers across the hospitality industry. Data was collected over a January 2020 - October 2021 timeline. A shifting number between 31,044 and 74,086 AU-based hospitality workers were analysed monthly, as well as 12,013,005 shifts and 75,452,622 hours by Deputy and consulting Labor Economist, Shashi Karu.

About Shashi Karu:

Shashi specialises in advisory services in policy and market design; thought leadership in city, workforce and future technologies; and economic strategies. He works closely with a variety of federal and state government entities, international development organisations, tech start-ups and ASX-listed companies. 

About Deputy: 

Deputy is on a mission to Simplify Shift Work™  for millions of workers and businesses worldwide. The company streamlines scheduling, timesheets, tasks and communication for business owners and their workers. More than 260,000 workplaces globally use Deputy to manage to schedule and effectively communicate with employees, providing millions of shift workers with more flexibility and control over their schedules. Deputy’s software helps businesses navigate workforce legislation including wages, overtime, entitlements and penalties - providing businesses with tools to simplify compliance and build a thriving workplace.

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Staying Open: Future Proofing Aussie Hospitality Report StayingOpen-AU-V1 (4).pdf - 2 MB
Mat Beeche
Mat Beeche Global Strategic Communications Director



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