LABOUR: Tourism Industry’s Wages Conspicuously Low

By Gustavo Capdevila Reprint | | Print |

Gustavo Capdevila

GENEVA, Apr 3 2001 (IPS) - The tourism industry – hotels, catering, hospitality – employs three percent of the world’s labour force, but pays wages that are 20 percent less than the average of the rest of the economy due to the high proportion of unskilled workers in the sector, reports the International Labour Organisation (ILO).

The hotel and tourism industry’s direct services provided to tourists represent three to four percent of the gross domestic product (GDP) in most of the world economy, though its three- percent average annual growth has not surpassed the expansion of the international economy in recent years.

The highest growth rates for tourism are found in South Asia, at 9.1 percent, the Caribbean (6.8 percent) and Central and Eastern Europe (5.2 percent). Western Europe recorded a 2.3 percent expansion for the sector, falling below the world average, and the Asia-Pacific region’s growth was lowest, at 1.4 percent.

The ILO gathered these statistics in a report on the evolution of the sector over recent years, intended for representatives of government, trade unions and employers who are in Geneva this week to assess tourism industry development.

The economic circumstances of the sector normally categorised under “tourism” also covers personal travel (for pleasure or other reasons) and business travel, whether international or within a country.

The ILO report indicates there has been greater growth in cross- border travel than in any other area of the industry. Some 700 million tourists travelled to other countries last year, spending nearly 500 billion dollars.

Global tourism has received a major boost from the deregulation of air transportation. An estimated 80 percent of tourists who visit developing countries arrive by air.

The ILO has served as a sounding board for developing countries’ concern about their relatively low representation on the Internet and in the reservation systems run by the major airlines, and that the needs of small and medium businesses are not taken into account.

The international computer network is used more and more in selling and marketing tourist destinations around the world, and tourism has become one of the leading economic areas in which the Internet plays a central role.

The report maintains that on-line sales enhance the opportunities for developing countries to reap the benefits of their competitive advantage as tourist destinations.

But the multinational hotel chains are constantly building dominance, increasing their commercial activities through mergers and management contracts. In Europe, some 30 percent of the hotels are affiliated with a chain. In the United States, the proportion rises to 79 percent.

The largest hotel company, Cendant, hold 6,000 hotels for a total of 500,000 rooms. The world’s 20 largest chains own 27,000 chains, representing 3.26 million rooms.

The majority of the companies in the tourism, hotel and catering sector, in all its various areas, employ only a small group of workers on a permanent, full-time basis.

A larger portion of the workforce is employed under irregular contracts, including part-time, seasonal and temporary jobs.

Most of the workers in the industry come from vulnerable sectors of the population. Half are under age 25, approximately 70 percent are women, and child labour is a persistent problem.

Despite their overwhelming presence, women have a much lower representation in management, holding just 40 percent of those posts.

The ILO found that the higher one goes in the hierarchy, the fewer women there are, as they occupy a scant one percent of the best-paid posts in the sector.

The international labour body attributes the wage imbalance of the industry, 20 percent less than in the rest of the economy, to its higher proportion of unskilled workers.

Tips and gratuities enhance the income only of those workers who have direct contact with clients. In general, salaries are lower among smaller companies and those businesses that subcontract out their services.

The report acknowledges that young children work in all areas of the industry, especially in family-run businesses, but also on their own as vendors or porters.

Obviously, says the ILO, the worst form of child labour that occurs in the sector is commercial sexual exploitation. Industry leaders are involved in innovative programmes to prevent prostitution networks from perpetrating such exploitation of children in the context of tourism.

Meanwhile, trade unions are demanding that the tourism industry recognise unionists as legitimate interlocutors in the debates affecting the sector’s workers.

They have also condemned the anti-union attitudes expressed by some tourism-related transnational corporations in countries where workers’ organisations are otherwise very strong.