THE U.S. HOTEL industry is not making enough progress in improving racial diversity, according to a recent report from the NAACP. In fact, the report found that the industry appears to be going backward in terms of including African Americans and other non-white minorities in its top ranks.
The group’s 2019 Opportunity and Diversity Report Card: Hotel and Resort Industry report analyses the hotels’ workforce, employee transitions, corporate management and ownership. The review includes “report cards” for major companies like Hilton, Marriott International, Hyatt Hotel Corp. and Wyndham Hotel & Resorts.
The grades were not all up to the NAACP’s expectations. African Americans and other minorities seem to fill mostly entry-level and lower-wage positions while going unrepresented in higher-level, better paying jobs, such as general manager.
“Although the lodging and hotel industry is staffed mainly by workers of color, racial and ethnic minorities remain inequitably dispersed throughout the lodging workforce,” the report said. “In fact, startling data indicate that at the very top of the workforce the hotel sector is getting whiter.”
The stability of the hotel industry, which grew from $123 billion to $176 billion between 2009 and 2014 and which employs more than 2 million people, makes it a focus of NAACP’s Economic Reciprocity Initiative launched in 1996. That’s the origin of the report cards the group issues on industries’ return on investments from the African American community.
Since the last report in 2011, the current report said, there has been little improvement in the lodging industry’s diversity. It cites data from the U.S. Equal Employment Opportunity Commission showing that the percent of top management positions held by people of color dropped from 29 percent in 2007 to 19 percent in 2015.
“Historical data suggest that in some cases the industry is moving in the wrong direction in terms of diversity and inclusion,” the report said.
In the hotel industry specifically, about 89 percent of African Americans, 90 percent of Hispanics, and 86 percent of Asians in the business 2007 were considered unskilled or semi-skilled, compared with just 75 percent of white staff.
“By 2015,these figures had not changed,” the report states. “From 2007 to 2015 about 15 percent of white workers occupied middle-management positions in the industry, with just 5 percent of minority staff rising to this level.”
African Americans make 4.5 percent of top management in the hotel industry, according to the report, and other minorities make up 13.6 percent. The boards of directors for hotel companies are even more exclusive, with African Americans making up 0 to 21 percent to average 12 percent while other minorities average 6 percent.
Of the four companies listed in the report, Marriott received the best report with an overall grade of B.
It received a B for its inclusion of African Americans and other minorities among its property managers. It got an A for African Americans on the board, but a D for other people of color in the same category.
“Marriott excels in African American workforce diversity in several categories, including board membership, middle management, and semi-skilled workers,” the report said. “For people of color, the results are not as strong but at least meet industry averages. For top and middle management there is room for improvement, but among the other workforce categories African Americans and other minorities are strongly represented.”
The other three hotel companies received Cs.
Hilton received an F for diversity among board members, in promotions and tier 1 suppliers. It also got an F for the number of African Americans in top management and a D for other minorities in the same category. It did receive As in other levels of its workforce below middle management.
“Hilton’s report card is complicated by its lack of African American franchisee data. The large number of people of color (not including African Americans) among franchisees is a positive sign,” the report said. “However, the overall low level of diversity, specifically among African Americans, throughout the upper levels of the workforce is of particular concern.”
Hyatt got an F for the diversity of its management level workforce and tier 1 suppliers. Its other grades were mostly Cs and Ds for African Americans and a little better for other minorities.
“Hyatt has improved the representation of African Americans among top management staﬀ since the 2012 survey. Although 2017 showed a decrease in the number of people of color working in highly skilled positions in comparison with 2012, the level of African American diversity throughout the rest of the workforce held steady in 2017,” the report said. “Opportunities for improvement include collecting and sharing diversity data for ownership and management, as it did in 2012; sharing supplier diversity data; and working on inclusion of people of color (not including African Americans) on its board.”
And Wyndham also received a failing grade for the diversity of its managers and for African Americans among its tier 1 suppliers, it got a B for other minorities in the latter category. However, it also submitted the smallest sample of hotels and employees, so it received the same grade as it did in the NAACP’s 2012 report.
“The diversity data examined in this report card shows failing grades in many vital areas, including ownership, top and middle management, and procurement,” the report said. “Wyndham has also reported lower African American diversity in several categories in comparison to its responses to the NAACP Opportunity and Diversity Report Card of 2012. In 2012, Wyndham received a C in African American top management, but now has an F.”
The company’s F for African Americans in its supplier pool also is down from a B in 2012.
Hotel organizations defended the industry’s efforts to diversify in light of the NAACP report.
“Hospitality is the starting point for millions to realize the American dream. No other industry has provided more people the first opportunity to begin a career,” said American Hotel and Lodging Association President and CEO Chip Rogers. “As an industry, we have supported multiple initiatives in that promote diversity and inclusion, including the recent launch of our Hospitality is Working campaign, our commitment to bridging the employment gap and empowering communities across the country to be successful. While there is always room for improvement, we are committed to working with our members to further advance these efforts and ensure we are a gateway to opportunity for everyone.”
AAHOA Interim President and CEO Rachel Humphrey said it and other associations, including NABHOOD and the Latino Hotel Association, still have work to do to foster an inclusive attitude in the industry.
“AAHOA is an association founded, in part, to combat prejudice and discrimination in the hospitality industry,” she said. “AAHOA’s commitment to this principle is evident over three decades of fighting for equality and in the two scholarship programs, developed in partnership with the Conrad N. Hilton College of Hotel and Restaurant Management at the University of Houston and the Michael A. Leven School of Management, Entrepreneurship and Hospitality at Kennesaw State University, that provide access to those who want to develop an educational foundation to pursue hospitality careers.”
Andy Ingraham, president/CEO of the National Association of Black Hotel Owners, Operators and Developers, suggested a way that can change.
“The common denominator for African American hotel owners is having a successful background in any business which allows him to have access to capital to be an investor or owner,” he said. “As an operator, they will need to have hotel industry operation background. Keep in mind that most owners are purely investors and therefore hire a third party operator to run the hotel.”
The NAACP recommends that hotel companies focus on their diversity weak spots, ownership, board of directors, top management, and supplier diversity.
“Each of these areas does not require massive numbers of new people in these spaces, but rather targeted ongoing eﬀorts that can have significant impact over time,” the report said. “These types of eﬀorts will require staﬃng that can develop relationships and end the long-standing history of lack of diversity in these top-level positions.”
The hotel industry also has more to do to achieve gender equality, according to the Castell Project’s Women in Hospitality Leadership Report. According to the report, women fill 11 percent of hotel company leadership positions including managing director and president, and their low representation on upper management levels is due in part to a lack of promotion and also to the fact that women often do not yet lead hotel development projects or hotel ownership groups.