Avoiding Overstaffing and Understaffing in Hotels

 


Avoiding Overstaffing and Understaffing in Hotels

In the hotel business, people are one of your greatest assets and one of your biggest operating costs. Having too many employees can significantly increase payroll expenses, while having too few can lead to poor service, employee burnout, guest complaints, and lost revenue.

The real challenge for hotel managers is finding the right balance: having the right number of people, with the right skills, in the right department, at the right time.

What Is Overstaffing?

Overstaffing occurs when a hotel employs more people than it needs to operate efficiently.

For example, a hotel may schedule ten front-desk employees during a period when guest arrivals are low and only four or five employees are actually required. While the hotel may still provide good service, it is spending money on labour that is not generating sufficient value.

Problems caused by overstaffing include:

  • Increased payroll and overtime costs

  • Lower employee productivity

  • Higher recruitment and training expenses

  • Increased idle time

  • Reduced profitability

  • Difficulty controlling operating expenses

Overstaffing can be particularly damaging during low seasons when hotel occupancy falls.

What Is Understaffing?

Understaffing is the opposite. It happens when there are not enough employees to meet operational and guest-service requirements.

A hotel may save money on salaries in the short term, but the consequences can be much more expensive.

Understaffing can result in:

  • Long queues at reception

  • Slow check-in and check-out

  • Delays in room cleaning

  • Poor restaurant service

  • Unanswered guest requests

  • Employee fatigue and burnout

  • Increased mistakes

  • Negative reviews

  • Reduced guest satisfaction

  • Loss of repeat business

A hotel that consistently understaffs may eventually damage its reputation, even if its labour costs look attractive on paper.

The Importance of Workforce Planning

Effective hotel staffing should never be based simply on the number of rooms available.

Managers should consider several factors, including:

Occupancy: A hotel operating at 40% occupancy does not require the same staffing level as one operating at 90%.

Guest arrivals and departures: Staffing should increase around peak check-in and check-out periods.

Seasonality: Holidays, weekends, festivals, conferences, weddings and tourism seasons can dramatically affect demand.

Department workload: Housekeeping, front office, food and beverage, maintenance and security have different staffing requirements.

Guest profile: Business travellers, families, groups and VIP guests may have different service expectations.

Events and conferences: Large events can create sudden demand for rooms, food, housekeeping and guest services.

How Hotels Can Find the Right Staffing Balance

1. Use Occupancy Forecasts

Accurate occupancy forecasting is one of the most important tools for hotel staffing.

Managers should review expected occupancy several days or weeks ahead and adjust staff schedules accordingly.

Instead of asking, “How many employees do we normally need?”, ask:

“How many employees do we need based on the expected business?”

2. Analyse Historical Data

Past performance can provide valuable insights.

Compare staffing levels with:

  • Occupancy

  • Revenue

  • Number of check-ins

  • Number of check-outs

  • Rooms cleaned

  • Restaurant covers

  • Events

  • Guest complaints

This helps managers identify patterns and determine where staffing adjustments are necessary.

3. Introduce Flexible Scheduling

Hotels operate differently from traditional nine-to-five businesses.

Flexible shifts can help match employees with demand. For example, additional employees can be scheduled during peak periods and fewer employees during quiet periods.

Split shifts, part-time employees and cross-trained staff can also provide flexibility where appropriate.

4. Cross-Train Employees

Cross-training is one of the most effective ways to manage staffing challenges.

An employee who understands more than one function can provide support when another department becomes busy.

For example, employees can receive additional training in areas such as:

  • Front office

  • Reservations

  • Guest relations

  • Food and beverage

  • Housekeeping support

Cross-training does not mean asking employees to perform tasks outside their competence. It means developing a flexible workforce that can respond to changing operational demands.

5. Monitor Productivity, Not Just Headcount

A hotel should not judge staffing efficiency solely by the number of employees.

Managers should also measure productivity.

Useful indicators include:

  • Rooms cleaned per housekeeper

  • Guests served per food-and-beverage employee

  • Check-ins processed per front-desk employee

  • Labour cost per occupied room

  • Labour cost as a percentage of revenue

  • Revenue per employee

These metrics provide a clearer picture of whether staffing levels are actually supporting profitability.

Technology Can Help

Modern hotel technology can make workforce planning easier.

Property Management Systems (PMS), scheduling software, revenue-management systems and business intelligence tools can provide information that helps managers anticipate demand.

For example, if the PMS shows a large number of arrivals expected between 3:00 p.m. and 7:00 p.m., management can ensure sufficient front-office staff are available during those hours instead of maintaining the same staffing level throughout the day.

Don't Sacrifice Service for Cost Cutting

One of the biggest mistakes hotel managers make is viewing labour only as an expense.

Employees deliver the experience that guests are paying for.

Reducing staff too aggressively may improve the payroll figure temporarily but create larger costs through:

  • Poor guest reviews

  • Refunds and compensation

  • Staff turnover

  • Recruitment expenses

  • Lost repeat customers

  • Reduced brand reputation

The objective should therefore not be “employ fewer people.”

The objective should be:

“Employ the right people at the right time and deploy them efficiently.”

Watch Employee Burnout

Understaffing often places excessive pressure on existing employees.

When staff members are constantly working long hours, covering multiple positions and dealing with frustrated guests, morale can decline.

Burnout can lead to absenteeism, resignations and declining service quality.

Hotel managers should therefore monitor not only occupancy and revenue but also employee workload, absenteeism, turnover and engagement.

A Balanced Approach Improves Profitability

The best hotels understand that staffing is a strategic decision.

A well-planned workforce can help a hotel:

  • Control labour costs

  • Improve guest satisfaction

  • Increase productivity

  • Reduce employee turnover

  • Maintain service standards

  • Respond quickly to changes in demand

  • Improve overall profitability

Final Thoughts

Overstaffing wastes money. Understaffing damages service. The solution is intelligent workforce planning.

Hotel managers should continuously analyse demand, forecast occupancy, monitor productivity and adjust staffing accordingly.

The goal is not simply to have a full team or a small team. The goal is to create a right-sized team that can deliver excellent guest experiences while maintaining healthy operating margins.

In hospitality, profitability and service excellence should not be treated as opposing goals. With the right staffing strategy, they can work together.

What is your experience with staffing in the hotel industry? Have you seen more problems caused by overstaffing or understaffing? Share your thoughts in the comments. Don't forget to subscribe for more practical insights on hospitality, tourism and hotel management.

By Bunmi Adeola
Itohan Leisure – Stories, Travel, and Lessons from Life’s Journey

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