Vienna Austria’s hoteliers struggle. The Salzburg hotelier and restaurateur Sepp Schellhorn complains that a Wiener Schnitzel should not cost him 21 euros, but 35 euros. The entrepreneur and former parliamentarian runs a hotel in Goldegg and two ski restaurants in the nearby mountains.
Schellhorn is just beginning to feel how great the personnel shortage is in tourism and what that could mean for the costs. He needs a little more than 80 employees for the ski restaurants, for example. In previous years he had signed an employment contract with 70 percent of them in September; this year in mid-November he was only able to employ 20 people on a permanent basis.
In the face of such shortages, it is no wonder that employee wage claims are rising. Above all, talented chefs have discovered their market value. However, from the point of view of hoteliers, raising salaries on a large scale is not that easy. Because they fear that the guests would not accept higher prices.
There are many reasons for the shortage of personnel. Many Eastern Europeans returned to their home countries during the pandemic and continue to stay away from Austria. “These people are staying in their home countries for the time being because of the insecurity associated with the pandemic,” says Austria’s Minister of Labor Martin Kocher.
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The employees are plagued by the uncertainty as to whether the ski season in Austria will really take place in full and whether there will be freedom of travel throughout the winter. In addition, Hungarians in particular are often vaccinated with the Russian vaccine Sputnik, but this is not approved in the EU.
“Service industries have a difficult time on the labor market”
Half of Austrians and half of foreigners work in Schellhorn’s ski restaurants; the latter come from Germany and Eastern Europe. Such conditions have been common for some time. Six years ago Johannes Kopf, member of the board of the public employment service AMS, referred to the influx of well-qualified workers from abroad.
At that time, however, there was still concern in Austria that well-qualified foreigners would crowd out local workers. There is no longer any talk of that. Locals are becoming increasingly difficult to get them to work in the hospitality and hospitality industries. “We live in a leisure society,” says Schellhorn. “In such an environment, service industries have a difficult time on the labor market.”
Employees in tourism work when their family members and friends are spending their free time – the more work alternatives there are, the fewer workers want to put up with it.
Especially since there is a lack of wages. “The employees cost too much and earn too little,” says Schellhorn. He is addressing Austria’s high ancillary wage costs. For an unmarried employee with an average wage, the share of taxes and duties is 47 percent according to the OECD (Germany 49 percent).
“The employees cost too much and earn too little,” says the hotelier.
(Photo: picture alliance / Lukas Ilgner / Verlagsgruppe News / picturedesk.com)
At the beginning of October the government announced an eco-social tax reform. In this context, however, she only wants to lower corporate income taxes and does not affect the ancillary wage costs.
Concern about insufficient equity
This has caused disappointment and anger among business representatives. For some time now they have been fighting for a tax reform with the catchy slogan “More net from gross” in order not to lose any further competitiveness. So far, the business representatives have not been heard in Vienna. The financial situation of the republic is tense after 22 months of pandemic with financial aid worth billions and sometimes poorly targeted.
In the meantime, Schellhorn is trying to position itself as a sought-after employer by making the employees’ lives more pleasant. He built a staff house for her and there is food from the buffet. “But I can’t offer the employees wellness,” he says.
The shortage of personnel is just one of many worries that Austria’s tourism professionals are currently plagued with. Before the pandemic, tourism was one of the flagship industries in the country, but the never-ending epidemic exposed structural weaknesses. “Resilience is required in a crisis,” says Oliver Fritz, economist at the Wifo business institute. “But many hotels in Austria lack this.”
The reason is the lack of equity. In many cases, the equity ratio is too low to survive in the long term. On average, it is below 15 percent for Austria’s hotels. “And it will continue to fall because of the pandemic,” says advisor Thomas Reisenzahn.
Last year’s winter season in Austria was completely canceled due to the pandemic. If the guests did not dare to go into the country this year because of the currently very high number of infections, a lockdown would also come for vaccinated people or if Germany, the most important source market, were to introduce stricter travel restrictions, this would cause great economic damage in the west of the country. In the federal states of Tyrol and Salzburg nothing works in winter without German guests.
It is now also taking revenge that companies have fought a costly arms race in recent years, for example by building expensive underground car parks or luxurious wellness facilities. The success on the international markets apparently proved Austria’s companies to be right. The number of overnight stays rose year after year, to a record 73 million in the last winter before the pandemic.
But as the low equity ratios show, profitability has not kept pace with this growth. “The companies paid too little attention to space efficiency,” says Reisenzahn consultant. And Schellhorn says: “In the past 15 years there has been a wave of investments in“ hardware ”.
How quickly Austria will regain the record number of overnight stays is a matter of dispute. Some tourism experts consider skiing and having fun to be a basic need of the guests. Others, including Schellhorn, warn that the number of skiers in Europe is falling.
Such uncertain prospects have an impact on a central success factor of Austria’s alpine hotel industry: the management of the businesses by the respective owner. It is increasingly difficult for them to find successors in the family. The children see how exhausting the job of hotelier has become and turn to another occupation.
However, Schellhorn, father of three children, initiated the succession four years ago. In two years, his middle son Felix will take over the hotel in Goldegg. This is a first step, says the entrepreneur; The successor solution for the ski restaurants is still pending.
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