Study: NH hotel tax revenues to surpass pre-pandemic figures

But industry hiring remains far lower than pre-Covid numbers

Projected state and local tax revenues from hotels are expected to eclipse pre-pandemic levels this year, bringing in over $145 million to New Hampshire.

But despite the rosy outlook for the industry, the nettling problem of an insufficient workforce remains a major concern.

According to an Oxford Economic Analysis released by the American Hotel & Lodging Association, 2023 state and local taxes generated by hotels will come in at $145,911,378, an impressive 13.8 percent higher than the $128,169,021 collected in 2019. The increase translates to over $17 million more in 2023 than before the pandemic and includes a 0.5 percent cut in the rate, to 8.5 percent, in October 2021.

Nationwide, projected tax revenues this year are expected to increase 13.6 percent from 2019, jumping more than $5.5 billion from $41.1 billion to $46.7 billion in 2023. The projected revenue increase will surpass pre-pandemic levels in all 50 states, though local revenues in the District of Columbia are expected to decline 1.1 percent, according to the report.

Average U.S. hotel occupancy is projected to reach 63.8 percent in 2023 — just shy of 2019’s level of 65.9 percent, the report found.

Staffing, however, remains a challenge for many hotels in 2023, as the industry tries to grow its workforce back to pre-pandemic levels.

“Hotels are making significant strides toward recovery, supporting millions of good-paying jobs and generating billions in state and local tax revenue in communities across the nation,” AHLA CEO Chip Rogers said.

In New Hampshire, according to the AHLA/Oxford Economics survey, direct employment by hotels — employees such as housekeepers and front desk agents — is projected to stand at 7,762 in 2023. That’s a drop of 11.9 percent from the 8,760 direct employees in 2019.

The picture is similarly discouraging when it comes to hotel-supported employment — a figure that includes those directly employed by hotels as well as those employed by other businesses that are supported by hotels, including restaurants, retailers, attractions, transportation services and hotel suppliers. Total hotel-supported employment in 2019 was 36,650, 11.4 percent higher than the projected 32,745 for 2023, according to the AHLA.

According to the U.S. Bureau of Labor Statistics, hotel employment is down by more than 250,000 jobs compared to February 2020. Hotels are looking to fill many of the jobs lost during the pandemic, including nearly 100,000 hotel jobs currently open across the nation.

Nationally, the AHLA reported that nearly 80 percent of hotels are experiencing staffing shortages.

To attract workers, a survey of hotel owners across the U.S. found, 71 percent of respondents said they were increasing wages, 64 percent said they were offering greater flexibility with hours, and 33 percent said they were expanding benefits. As of December 2022, the AHLA reported, national average hotel wages were at historic highs of over $23 an hour.

However, 79 percent said they were experiencing a staffing shortage, 22 percent of them severely so. The most critical staffing need is housekeeping, with 43 percent ranking it as their top hiring vacancy. Nearly 100,000 hotel jobs are currently open across the nation, according to the employment website Indeed.

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