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Hotels and Resorts State of the Industry |
In 2006 Canada there are 8,287 hotels, motels, Inns and resorts in Canada with 437,818 rooms employing 378,000 people that generated revenues of almost $17.9 billion.
Tight labour markets, particularly in Western Canada led to rising wage rates in the summer of 2007. With job creation expected to stay healthy, labour costs will remain an issue for the accommodation industry. Hoteliers were able to consistently raise prices above the rate of inflation thanks to their ability to compete on service as well as price. This allowed them to pass their rising costs on to consumers and achieve improved profitability.
The key issues in the outlook for 2008 were domestic travel, the high Canadian dollar and the challenge of a labour shortage:
• Domestic Travel—Although growth in domestic travel spending will weaken in the near term, it will continue to be the primary support for accommodation demand in the face of shrinking foreign expenditures.
• Dollar—The high value of the Canadian dollar is limiting foreign demand for accommodations and inducing more Canadians to travel overseas.
• Labour Costs—Industry wage appreciation remains high as hoteliers continue to report that labour shortages are a major challenge.
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