Arnie Weissmann
Despite concerns last month about rising unemployment, the travel industry bucked the general trend, with "leisure and hospitality" hiring remaining steady, filling an additional 23,000 vacancies.
And shortly after that jobs report was released, the U.S. Travel Association pointed out that there's still a long runway for travel job opportunities, with a million openings.
One would think that this imbalance in supply and demand would be good news for anyone in the travel industry seeking employment. And indeed, it may be so for many looking for a career in travel.
But Sherry Caserta, president of the Travel Employment Agency, said that when it comes to travel advisors, the picture is not as rosy.
In a recent client newsletter, the 30-year travel industry recruitment veteran wrote that she sees the number of job postings for travel advisors to be below average.
The situation for travel advisors has been a roller-coaster ride since the beginning of the pandemic, she noted, with layoffs the norm after the pandemic was declared.
But once hiring resumed, employers sought both agents and managers, weeding out anyone who wasn't "A-team" material. They needed staff quickly -- "yesterday," she wrote -- and offered salaries that were the highest she had ever seen. To get people to return, employers were offering $10,000 more a year than their pre-Covid salaries. "We saw $70,000 salaries where previously it was hard to find $55,000, and this was happening everywhere.
"But once initial urgency abated," she continued, "companies turned their heads to growth, and business development managers were in demand. Group agents and managers were in demand. Salaries were still good but not as high as the immediate rush right after Covid."
Despite the million jobs U.S. Travel says are open, Caserta said that travel agency jobs are getting more difficult to find. "Large companies are buying up regional agencies and may not bring those onboard where they already have an existing department and team. I see more corporate agents seeking jobs, and companies hiring for leisure positions are looking for independent contractors who can bring their business with them."
Outsourcing abroad to lower expenses is on the rise, as well, she observed.
The days of $70,000 offers have ended. "Companies are hiring at lower pay, and the process is taking longer," she wrote. "What was traditionally a two-interview process has turned into three or four meetings. Those asking for a lower salary are being considered first. As a trade-off, agents who are accepting lower salaries are looking for better healthcare programs, longer vacations and 401(k)s."
The presidential election, changes brought on by technology and the lingering worry about recession are all factors that traditionally affect the jobs market, she pointed out. But she also sees some consumer trends that may, at least in the short term, benefit travel generally. For instance, those who are finding it difficult to buy a home may use savings for more immediate gratification: Travel.
Caserta has no clear-cut forecast for the near future. "The roller-coaster ride will continue," she concluded. "We just need to hang tight."
The metaphor is apt. Roller-coaster enthusiasts have their own lexicon, and the past few years can be described in their terms: What is called "the first drop," the initial plunge, occurred when the pandemic struck. It was followed by a record-breaking climb in travel sales (or, in roller-coaster parlance, the "lift hill"). A $70,000 salary was akin to "air time," that sensation of floating that roller-coaster riders feel when they experience negative g-forces.
For now, however, advisors looking for plum positions might feel they boarded a "shuttle coaster," one that proceeds forward, stops, then travels backward.
How long this phase will continue is unknown, but the influencing factors that Caserta cited are fluid. Electioneering will intensify, but it's transient. Technology that impacts jobs is typically a double-edged sword. And it looks like recession concerns are receding as inflation appears to be tamed.
The one factor that Caserta noted that stood out to me -- a trend that can have either a positive or negative impact on advisors -- is the rising preference that would-be employers have for independent contractors. An advisor who chooses to go this route loses a semblance of security and benefits, but those advantages are, more often than not, balanced by an IC's freedom to do things their own way, by lower cost structures than agency ownership requires and by financial rewards that are limited only by their talent in sales.
The rise of ICs makes salaries a less effective measure to evaluate financial opportunities for advisors. Overall, are ICs making more or less than those who were hired at $70,000 during the peak of the lift hill? It's certainly likely that the range of compensation for ICs is far greater than it is for salaried employees, even taking benefits into account.
Still, for ICs and employees alike, ups and downs are to be expected on a never-ending ride.