Low wages, birthrate hamper hotel labor pool: FIH

Although the service sector should double wages for workers over the next five years, it would have an effect on inflation, hotelier Steve Pan said

  • By Crystal Hsu / Staff reporter

Domestic hospitality operators generally do not have enough workers due to low pay and the nation’s low birthrate, Formosa International Hotels Corp (FIH, 晶華國際酒店集團) chairman Steve Pan (潘思亮) said yesterday.

Pan, whose group owns the Regent Taipei (台北晶華酒店) and domestic brands Silks Place (晶英酒店) and Just Sleep (捷絲旅), said that low pay is common at local service providers and the low birthrate has made the situation worse.

“The service sector should double wages for employees in five years, but the nation will then have to cope with the challenges of high consumer prices and acute inflation,” Pan told an economic forum organized by Chinese-language CommonWealth Magazine in Taipei.

Photo: CNA

Inflation would follow wage hikes and pay always moves upward, said Pan, who sold the profit-making pizza chain Domino’s Taiwan in June 2021 to maintain the group’s payroll.

Service sector businesses, especially hotels and restaurants, cannot afford steep wage hikes because of their pricing strategies, he said.

Free trade and globalization gave Taiwanese employers access to cheap labor over the past 30 years, but the COVID-19 pandemic upset that trend, he said.

Bottom-level service workers around the world are looking for significant wage increases, which could materialize if customers are willing to pay more, he said, adding that operators cannot survive otherwise.

FIH raised wages in the past three years, but has been unable to recruit enough staff to meet banquet reservations over the Lunar New Year holiday and annual spring gatherings, Pan said.

“Hotels cannot put off such reservations by three to six months as manufacturers can with unfilled orders,” he said.

Advanced nations allow the hospitality sector to hire migrant workers and Taiwan should do the same to tackle labor shortages, which pose the biggest challenge to the recovery in private consumption this year and beyond, he said.

FIH participated in more than 1,000 matching opportunities to fill vacancies for guest room staffers, but still struggles to hire staff, he said.

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