Hotels need life support, say trade group and union

 

The collapse of the tourism business because of Covid-19 has left Penang hotels in the doldrums. (Bernama pic)

GEORGE TOWN: More hotels are likely to take drastic action to cut their losses because of the effect of the second movement control order, while a hotel union said its 8,000-odd members are in dire straits.

This comes on the heels of news of the impending closure of the Equatorial, Penang’s largest hotel by number of rooms, and retrenchments by Shangri-La group hotels through voluntary separation schemes.

Speaking to FMT, the Malaysian Association of Hotels (MAH) chief executive Yap Lip Seng said occupancy at most hotels had dipped below 20% after the second MCO was announced.

He said with virtually no income for hotels during this MCO, the coming weeks appeared to be bleak.

“After sustaining losses for close to a year, the present situation is worse.

“Hotels will be forced to make quick decisions. The hotels might not be able to wait for the government to decide if the MCO would be extended or not. The lack of clarity is making it difficult for planning,” he said.

He said an increase in wage subsidies is urgently needed.

Long hibernation for Penang’s hotels

Penang MAH chairman Raj Kumar said hotels have no choice but to downsize operations and find other means to stay afloat.

“We understand that our government’s main focus is the safety of the people. We have to cut our losses. If the situation continues or worsens, we have no other alternatives but to shut down,” he said.

Penang’s once-lucrative hotel industry is set to go into a long hibernation as the second Covid-19 lockdown has left many hotels cash strapped, forcing many to shutter and its staff to go on long breaks, a seasoned hotelier weighing in on the issue said.

“While there was a wage subsidy offered to hotels from the government, some have only received part of the subsidy and some nothing at all. So it is natural for hotels to close shop,” said the hotelier who did not want to be named.

The industry has had a bull run for the past two decades, especially after George Town was named a Unesco World Heritage Site in 2008.

Rooms in pre-war homes turned into boutique hotels were a big hit among foreigners. Four-star and five-star hotels sprouted in key areas such as Gurney Drive and Batu Ferringhi with average room rates above RM350 during peak seasons.

But a month after the first lockdown last year, some of these hotels, including a boutique hotel, had closed.

The conference business collapsed, as 20 major events were cancelled. The conference industry surpassed RM1.5 billion in estimated economic impact to the state in 2019, government reports show.

But with leisure and business travellers no longer around, a large section of the 279 registered hotels with over 15,000 rooms in the state face an uncertain future.

We are dying, says hotel workers’ union

National Union of Hotel, Bar and Restaurant Workers Peninsular Malaysia secretary-general Rosli Affandi said the union’s 8,000-odd members are in dire straits.

Many have yet to receive their salaries on time and are forced to go on three to four-month unpaid leave.

Pleas to help minimum wage earners in the hotel industry have gone unanswered. To make things worse, hotels were using part-time staff or foreign workers paid by the hour, while permanent staff are put in cold storage.

He said while the recovery MCO had seen the hotel business pick up a little in top-tier destinations such as Penang, Langkawi, Cameron Highlands and Melaka, the others saw very little improvement.

Rosli said hotel workers are upset that the government has not included them in any up-skilling effort or made efforts to find them other jobs.

“Hotel workers have now become poverty-stricken. They are working three different jobs, selling kuih, and doing so many odd jobs for a living.

“When the PM announced the stimulus package recently, we were excited. But sadly, there is nothing for hotel workers. It is very saddening that not even a single YB has come to meet us to talk about our issues, despite our repeated calls.”

Between March and November last year, a total of 204 tourism and hotel businesses closed because of restrictions caused by the Covid-19 pandemic, tourism minister Nancy Shukri told the Dewan Rakyat in November. - FMT