Hotels that are empty don’t need so many people at the front desk or servicing rooms. Restaurants that aren’t allowed to serve guests except on a to-go basis don’t need as many servers, even if they had guests. And so Marriott has furloughed ‘tens of thousands’ of employees who will not be paid, but will continue to receive health benefits.
Many hotels will also be closing. The Wall Street Journal reports occupancy at U.S. properties has “plummeted to 20% or lower, and many hotels are in single digits.”
“As travel restrictions and social distancing efforts around the world become more widespread, we are experiencing significant drops in demand at properties globally with an uncertain duration,” Marriott said in a statement. “We are adjusting global operations accordingly, which has meant either reduction in hours or a temporary leave for many of our associates at our properties.”
Marriott, which had about 174,000 employees globally at the end of 2019, said the furloughs will affect all types of workers. They won’t be paid their salaries during their time away from the company, but they will receive health care benefits.
Remember that many Marriott hotels are franchised, and don’t have Marriott employees. Those hotels will likely see layoffs too, but under the banner of their owner’s or management company’s brand.
So far while the layoffs go up through general managers, there haven’t been any terminations or furloughs at corporate. That’s likely to change. This is only the beginning and I expect similar moves from other chains.