Hospitality industry hiring crisis reaches new heights


ByDr. Tim Sandle
July 14, 2025
DIGITAL JOURNAL


Waiter and diners. — Image by © Tim Sandle.

Many activities undertaken in leisure time in the U.S., including eating out, traveling and recreation, depend on a large workforce. Data from the U.S. Bureau of Labor Statistics (BLS) show that the leisure and hospitality sector is growing, adding many new jobs to support these activities. However, the sector is facing a recruitment ‘crisis’.

Rising earnings are the leading trend in the leisure and hospitality industry, with average hourly pay increasing to $22.53 in 2025 and outpacing inflation by 8.6%. In particular, hotels report the most understaffing, with 67% showing a lack of employees, while 45% of the restaurants cannot get enough workers.

To counterbalance these trends, the most popular recruitment strategy in the industry was social media use, with 60% of human resources professionals citing it as the best approach.

In March of 2025, for the U.S., the leisure and hospitality sector finally surpassed the 2020 peak, with 16.99 million jobs. A recent study by the firm Escoffier analysed statistics across the industry to identify 2025 hospitality hiring trends. The research compared restaurants, hotels, and event spaces across key factors, including average pay, understaffing issues, recruitment strategies, and the impact of global trade and tariffs on the industry.

Uneven Recovery: Sector Disparities in Hiring

Since the pandemic, the leisure and hospitality sector has been on the course to recovery, and in 2025, the trends show a significant growth in employment and hiring. Although the leisure and hospitality workforce has finally surpassed pre‑pandemic levels, with 16.99 million jobs in 2025, recovery is not uniform. Arts and recreation increased the number of jobs by 197.7K, while accommodation and food services lost 93.9K.

Labour Costs Surge

Average weekly hours in hospitality remain steady at 25.5, but average hourly earnings have jumped from $16.84 to $22.53 (up ~34%), outpacing inflation by 8.6%. Nearly 92% of operators report rising labour costs, and 74% see it as a major challenge.

Understaffing Crisis: Hotels Are Hit The Hardest

Understaffing impacts vary across sectors. Hotels report the most understaffing, with 67% showing a lack of employees, while 12% are in danger of closure due to staffing shortages. Restaurants are also affected on a large scale, with 45%, but only 19% of travel agencies have problems with finding staff.

Tech vs. Talent: High Hopes, Low Returns

While 80% of operators believe tech gives a hiring edge, just 15% see a measurable hiring improvement. Automation integration is one of the tech solutions that work in practice, allowing for a faster hiring process and better employee retention.

Upskilling and Education

Though 65% of applicants rank career development as critical, less than half of employers match those terms. Only 47% are reported to offer education perks. At the same time, 93% of employees use tuition assistance, and 76% reported that it influenced their decision to accept a job. Offering education support could cut turnover by 20–40%, against a current turnover rate of ~70–80%.

The above data suggests that as the hospitality industry continues facing staffing and retention challenges in 2025, operators must think strategically about how to stand out to job seekers. This includes thinking about what job candidates want, including flexible, career-building opportunities.