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Southern California Hospitality and Tourism Report Workplace Learning Resource Center, California Community Colleges

i

TABLE OF CONTENTS Table of Contents ............................................................................................................. i

List of Figures.................................................................................................................. ii

List of Tables ................................................................................................................... ii

Introduction ..................................................................................................................... 1

Economic Impacts ........................................................................................................... 4

Ecotourism, Sustainability and the “Green” Supply Chain ............................................... 7

Cluster Employment ...................................................................................................... 10

Wages ........................................................................................................................... 17

Hospitality and Tourism Skills and Preferences ............................................................. 18

Career Profile Pathways ............................................................................................ 26

Individual Pathway #1: Working Up the Ladder .......................................................... 26

Individual Pathway #2: Full-Time College .................................................................. 29

Individual Pathway #3: Career Transition ................................................................... 31

Industry Pathways ..................................................................................................... 32

Industry Pathway #1: Food and Beverage ................................................................. 32

Industry Pathway #2: Accommodations and Lodging ................................................. 33

Industry Pathway #3: Event and Conference Planning............................................... 34

Industry Pathway #4: Travel Services ........................................................................ 35

Industry Pathway #5: Entertainment and Attractions .................................................. 36

Conclusions and Recommendations ............................................................................. 37

Appendix A – College Programs ................................................................................. A-1

Appendix B – Data Sources ........................................................................................ B-1

Appendix C – California State University Programs ..................................................... C-1


ii

LIST OF FIGURES Figure 1: Proportion of Travel Spending in the Region by County (2012) ........................ 4

Figure 2: Distribution of Customers and Suppliers ........................................................... 8

Figure 3: Employer Adoption of Environmentally Friendly Goods and/or Policies and Practices ......................................................................................................................... 9

Figure 4: Percentage of Total Jobs in Hospitality and Tourism in Each County ............. 10

Figure 5: Expected 12 Month Growth ............................................................................ 12

Figure 6: Growth Over Last Three Years ....................................................................... 13

Figure 7: Hospitality and Tourism Percentage of Permanent Employees by Size .......... 15

Figure 8: Importance of Skills for Non-entry-level Promotion ......................................... 18

Figure 9: Frequency of Promotion for Non-entry-level Positions .................................... 19

Figure 10: Importance of Experience and Training for Entry-level Job Candidates ........ 20

Figure 11: Difficulty Finding Entry-level Job Candidates ................................................ 21

Figure 12: Relationship with CTE or ROP ..................................................................... 22

LIST OF TABLES Table 1: Visitor Spending by Commodity Purchased (2011) ............................................ 5

Table 2: Top Ten Growth Industries by Change in Total Jobs from 2013 to 2016 .......... 13

Table 3: Top Ten Declining Industries by Change in Total Jobs from 2013 to 2016 ...... 14

Table 4: Staffing Patterns for Hospitality and Tourism in Southern California, 2013 ...... 15


1

INTRODUCTION Southern California’s Hospitality and Tourism cluster is large, diverse, and critical to the economic vitality of the region. According to a May 2013 report by the California Travel and Tourism Commission,1 Southern California, which is defined for this report’s

purposes as Los Angeles, Orange, Imperial and San Diego counties, attracts billions in Hospitality and Tourism consumer spending. In fact, as noted in their 2013 report, the regional cluster was responsible for over two-fifths of direct travel impacts in California across several key categories in 20122, including;

Hospitality & Tourism spending - $45,845,168,000 (45% of California total)

Hospitality & Tourism earnings - $14,409,944,000 (47% of California total)

Local tax receipts - $1,065,784,000 (46% of California total)

In addition to its large economic impact on the region, the cluster, comprising over 35,000 establishments in food, accommodation, entertainment, travel, events, and other related activities, employs nearly 800,000 workers in Southern California. This figure represents 10.2% of the total workforce in that region.3 Positions range from the entry-level through management, and include emerging occupations (such as hotel and restaurant “green” supply chain managers) and significant entrepreneurial activity.

Beyond its sheer size, there is perhaps no better cluster for developing skills that are critical for the 21st century workplace. Hospitality and Tourism employers seek and develop skills related to communication, problem solving, critical thinking, customer service, and many others which are widely reported as deficient in new entrants to the workforce. The breadth of opportunity and potential for lifetime career advancement, both within and outside the cluster, is staggering.

Despite these seemingly obvious attributes, Hospitality and Tourism is often left out of long-range workforce development efforts. The cluster has many food service

1 Source: http://industry.visitcalifornia.com/media/uploads/files/editor/Research/CATravelImpacts2012.pdf 2 Projected 2012 numbers

3 EMSI Class of Worker, 2013.3

http://industry.visitcalifornia.com/media/uploads/files/editor/Research/CATravelImpacts2012.pdf


2

occupations with lower wages (and even lower reporting of wages), which has skewed the official estimates for the cluster, in aggregate, lower. However, upon deeper review of the data, this average wage of the cluster hides tens of thousands of jobs that pay a self-sufficient wage in the region.

The Workplace Learning Resource Centers at Cuyamaca College and El Camino College commissioned BW Research Partnership, an independent research firm, to conduct this research study. The study has been produced in order to learn more about the importance of the Hospitality and Tourism cluster in Southern California, as well as provide preliminary data for reference to the new “Doing What Matters for Jobs and the Economy” initiative from the California Community College Chancellor’s Office. It includes existing data from several sources to determine the size and scope of the cluster and its impacts; a stratified, clustered, and representative survey of Southern California Hospitality and Tourism employers; and follow up interviews with selected business leaders.

The findings of this research suggest that Hospitality and Tourism must be considered one of the most – if not the most – important segments of the Southern California. It attracts billions of dollars to the region and employs nearly one in ten workers throughout Southern California – and perhaps most importantly, generates thousands of new openings annually all across the career ladder and for varied skill levels.

This report includes a summary of these data. Specifically, it provides information about the cluster’s economic impact on the region (and each community), overall employment trends and employer preferences, career pathways that are available to job seekers, and conclusions and recommendations.

About Workplace Learning Resource Centers

Among the activities of the California Community Colleges Chancellor’s Office, the programs of the Division of Workforce and Economic Development bridge the skills and jobs mismatch and prepare California’s workforce for 21st century careers. The Division serves as administrator for several streams of state and federal funds, including Governor’s Career Technical Education Pathways Initiative (SB1070), Carl D. Perkins Career and Technical Education Act of 2006, and Proposition 98 dollars for Apprenticeship, Economic & Workforce Development (EWD), and Career Technical Education (CTE). The Division collaborates with employers, organized labor, local communities, and their community colleges through programming supported by these funds to close the skills gap and to foster successful student completion. One of the key components to the Chancellor’s Office development of “Doing What Matters for Jobs and the Economy” is to focus the Workplace Learning Resource Centers on the Retail, Hospitality, and Tourism sectors and the development of “Learn and Earn” partnership strategies with businesses in the regions. Traditionally, The Workplace Learning Resource Centers (WpLRCs) – sponsored by the California Economic and Workforce Development program – are committed to California’s economic growth and meeting the training needs of businesses throughout


3

the state. The WpLRCs are comprised of Regional Centers that provide high-quality and affordable training programs on today’s most critical business topics and needs. Topics include:

Workplace Basic Skills Working in and Leading Teams Leadership and Management Customer Service Generational & Cultural Diversity Creativity and Critical Thinking English as a Second Language Business Math Business Communications

The WpLRCs’ training programs and services benefit businesses from all industries throughout the state including agriculture, healthcare, energy & utilities, military & government, and a new emphasis on the retail and hospitality sectors. Because WpLRCs’ programs focus on the core fundamentals and advanced workplace skills they are transferrable to all industry sectors and benefit workers throughout their careers. Perhaps most importantly, the Workplace Learning Resource Centers assist community colleges in developing programs through grant funds, which support pre-credit classes to prepare students for Career and Technical Education (CTE) course work and obtain short-term credentials. The centers also assist college and high school students in career exploration activities to prepare for college and employment.

About BW Research Partnership

BW Research Partnership, Inc. was created out of a belief that the highest quality research products and consulting services to corporations, government agencies, educational institutions, and non-profit agencies are a result of: 1) A research process that is focused on providing the most reliable results using the most effective methodologies; 2) Creating a partnership of professionals - not employees - who have a vested interest in the quality of our products and services; 3) A commitment to research that builds communities, supports workers and consumers, and provides a clear direction for decision makers.


4

ECONOMIC

IMPACTS According to a report of the California Travel and Tourism Commission, the Southern California (including Los Angeles, Orange, San Diego, and Imperial Counties) Hospitality and

Tourism cluster generated nearly $46 billion in spending in 2012. This is approximately 43% of all travel and tourism spending in California, and a major economic stimulus for the region.

Each of the four counties shows impressive spending from these Hospitality and Tourism activities. Los Angeles has the most spending at just over $23 billion, followed by San Diego at $13 billion, Orange County at $9.5 billion, and Imperial at $324 million.

Figure 1: Proportion of Travel Spending in the Region by County (2012)4

4 Source: California Travel Impacts by County, Dean Runyan Associates (2013), from:

http://www.deanrunyan.com/doc_library/CAImp.pdf

Los Angeles County 50.2%

San Diego County 28.5%

Orange County 20.6%

Imperial County

0.7%



5

As important as the total amount spent, it is also interesting and illustrative to review how consumers are spending their money. About 24%, or $10.1 billion regionally, is spent on Food and Beverage Services, followed by Ground Transportation and Motor Fuel (20%), Accommodations (17%), and Arts, Entertainment & Recreation (16%).

Table 1: Visitor Spending by Commodity Purchased (2011)5

Commodity $ Million % of Visitor

Spending

Food & Beverage Services $10,120 23.77%

Ground Transportation & Motor Fuel $8,525 20.02%

Accommodations $7,064 16.59%

Arts, Entertainment & Recreation $6,783 15.93%

Retail Sales $6,261 14.71%

Air Transportation (visitor only) $2,708 6.36%

Food Stores $1,116 2.62%

The cluster paid nearly $14.5 billion in wages in 2012, approximately 3% of all earnings in the region. In addition, the Hospitality and Tourism cluster was responsible for almost $1.1 billion in local tax revenue. About half of this tax revenue is collected in Los Angeles County, with about $273 million in San Diego County, $232 million in Orange County, and nearly $5 million in Imperial County.

In addition to these obvious impacts, Southern California is a major tourist destination, which means that the cluster attracts money from within and outside its regional economy. The cluster therefore has a strong multiplier effect, meaning that the impact of each dollar spent represents $2.34 of economic activity.

The impressive figures reported throughout this section should be placed into context, considering the slow economic recovery from one of the worst recessions in American history. The Gross Regional Product, a measure of the value of goods and services produced, continues to grow slowly, while the unemployment rate remains stubbornly high (see Figure 2, below). Given these conditions, the strong growth and impact of the Hospitality and Tourism cluster cannot be understated.

5 Source: California Travel Impacts by County, Dean Runyan Associates (2013), from:




6

Figure 2: California Unemployment Rate: Historic Trends6

6 Source: Bureau of Labor Statistics (BLS) historic unemployment (August numbers), from:

http://data.bls.gov/timeseries/LASST06000003

0%

2%

4%

6%

8%

10%

12%

14%

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013


7

ECOTOURISM, SUSTAINABILITY AND

THE “GREEN” SUPPLY

CHAIN One of the clear market trends that is creating emerging opportunities is the commitment of the Hospitality and Tourism cluster to sustainability. In a perceived “win-win” scenario, regional hotels, restaurants, and other facilities are deploying new products and procedures that save electricity and water and protect natural resources,

which not only satisfy their patrons but also save them money.

In addition to the conservation measures that have been adopted by many area hotels and restaurants, Southern California is part of a growing tourism segment called ecotourism. Ecotourism is travel that is focused on experiencing places for their natural beauty and practicing conservation measures to minimize or eliminate human impacts.

Southern California’s natural beauty is an obvious attraction to visitors around the world, and these visitors and local residents alike increasingly seek to preserve the natural environment for future generations. The national and state park and forest systems alone – ranging from Cleveland National Forest, Tijuana River Estuary, and Cabrillo Monument to the South, the Crown Valley National Park and Seal Beach Wildlife Refuge along the coast, and the Santa Monica Mountains to the North – include millions of acres of natural beauty to explore.

Ecotourism is big business. Across the globe, ecotourism is estimated to add $77 billion in economic activity. However, far more important to residents of Southern California, the industry provides context for the environmental conversations and actions that are critical to preserving the local environments. For example, ecotourism excursions to fragile desert ecosystems bring appreciation for water conservation, which leads to consumer demands on hotels and restaurants to use less water. Visits to pristine estuaries and beaches triggers calls for reducing waste and wastewater. These impacts have driven sustainability to the forefront of many Hospitality and Tourism managers’ minds.

Sustainability in the cluster is greening the supply chain, altering business relationships, and changing employment roles. It is creating altogether new jobs such as green supply


8

chain managers, and impacting skill requirements of existing ones, all while supporting the regional economy with building retrofits and other sustainability measures.

It is interesting to note the dynamics of customer and vendor relationships in this important cluster. For this study, firms were asked about the location of their suppliers and vendors, as well as the majority of their customers. Over half of all Hospitality and Tourism firms in the region identified their primary customers, suppliers and vendors as being local (within Southern California). Only 4% of surveyed firms identified their primary customers as being located outside of the country. This chart illustrates that most of the impacts of the cluster are felt locally.

Figure 2: Distribution of Customers and Suppliers

Hospitality and Tourism firms are clearly engaged in the “green” supply chain. Approximately three in five employers indicated that they had adopted environmentally friendly goods (61%) and/or policies and practices (58%). The vast majority of these employers (71%) did so to “protect the Earth” or because it was the “right thing to do.”

0.6%

2.2%

21.9%

21.3%

53.9%

0.6%

4.5%

26.4%

13.5%

55.1%

0% 20% 40% 60% 80%

Don't know/ Refused

Outside the United States

Within the United States

Within California

Within Southern California

Customers

Suppliers and Vendors


9

Figure 3: Employer Adoption of Environmentally Friendly Goods and/or Policies and Practices

3.9%

23.0%

58.4%

60.7%

0% 20% 40% 60% 80%

Don't know/ Refused

No

Yes, we have adopted environmentallyfriendly policies and practices

Yes, we have adopted the use ofenvironmentally friendly goods


10

CLUSTER EMPLOYMENT The large economic impacts of Southern California’s Hospitality and Tourism cluster are perhaps best demonstrated by its enormous employment. The cluster directly employs nearly 800,000 workers in the 4-county region, which represents 10% of all employment in the region. Orange County boasts the highest percentage total, with nearly 12% of its workforce, or about 190,000 workers, employed by the cluster. San Diego is close behind at 11%, or 169,000 workers, and Los Angeles, with 430,000 Hospitality and Tourism workers, comes in at 9%. Imperial County has nearly 68,000 workers in the cluster, representing about 5.5% of its total workforce.

Figure 4: Percentage of Total Jobs in Hospitality and Tourism in Each County

According to Economic Modeling Specialists, Inc. (EMSI) data7, the Hospitality and Tourism sector employs 793,259 workers in Southern California alone, which is just under 6% of the industry cluster’s national total. There are over 35,196 establishments in the Hospitality and Tourism industry across the four counties (close to half of these, however, are limited service restaurants, fast food establishments, buffets, etc.). Hospitality and Tourism is projected to grow at a higher rate in Southern California when compared to the Nation as a whole over the next three years (5.3% vs. 4.5%).

The 5.3% growth rate is also significantly higher than the overall projected growth across all jobs in Southern California, which is a meager 2.6% over the next three years.8 Over the longer term, Hospitality and Tourism jobs are expected to outpace all jobs

7

EMSI is a proprietary data source that is updated quarterly. 8 Source: EMSI QCEW and Self-Employment 2013.4

5.5%

9.3%

10.9%

11.8%

3,718

430,091

169,125

190,324

0% 5% 10% 15% 20%

Imperial County

Los Angeles County

San Diego County

Orange County


11

significantly, with a growth rate in the cluster of over 16%, compared to less than 11% for all jobs in the region through 2023.

Figure 5: % Percent Change in Tourism and Hospitality from 2013 to 20239

In the near term, the majority of Hospitality and Tourism firms (61%) indicated that they expected to retain the same number of employees over the next 12 months. Nearly a third of businesses said that they would have more total employees by the same point in time next year. When assessing Southern California businesses that provided both current and expected employment numbers, overall expected growth for the Hospitality and Tourism industry sits at 4.1% for the coming 12 months. This growth rate translates to projected growth of 32,524 jobs over the next year in Southern California, or nearly 825,783 industry jobs total at the same point in 2014. For comparison, EMSI estimates that Southern California economy-wide job growth will be an anemic 0.7% through 2014.

9 Id.

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

Southern California (Hospitality and Tourism)Southern California (overall)United States (Hospitality and Tourism)United States (overall)


12

Figure 5: Expected 12 Month Growth

These survey findings are largely in line with employers reported past growth. When asked to report firm growth over the last three years, over six in 10 employers recounted neither growth nor decline in overall employment. Only 6% reported a decline in total workers, while over 28% indicated positive growth. For those employers that recorded both current and past employment, an overall growth rate of 6.6% was calculated, over three percent lower than the EMSI reported growth in Hospitality and Tourism for the region from 2010 to 2013, but close to the 6% observed growth from 2010 to 2012.

More 32.0%

Fewer 2.2%

Same number of employees

61.2%

Don't know/ Refused

4.5%


13

Figure 6: Growth Over Last Three Years

Jobs are growing across the cluster. The table below displays the top 10 Hospitality and Tourism industries10 by expected total job growth from 2013 to 2016. Full- and Limited-Service restaurants are projected to add over 30,000 jobs in the next three years. Hotels and Motels, Snack and Nonalcoholic Beverage Bars and Amusement and Theme Parks are all expected to add over 3,300 jobs over the same time period. Table 2: Top Ten Growth Industries by Change in Total Jobs from 2013 to 201611

Description 2013 Jobs 2016 Jobs Change %

Change

Full-Service Restaurants 281,072 302,014 20,942 7%

Limited-Service Restaurants 202,528 212,339 9,811 5%

Hotels (except Casino Hotels) and Motels 91,099 95,800 4,701 5%

Snack and Nonalcoholic Beverage Bars 36,480 40,614 4,134 11%

Amusement and Theme Parks 31,876 35,258 3,382 11%

Food Service Contractors 21,800 22,933 1,133 5%

Fitness and Recreational Sports Centers 28,300 28,994 694 2%

Museums 5,842 6,489 647 11%

Golf Courses and Country Clubs 12,629 13,015 386 3%

Zoos and Botanical Gardens 2,783 3,090 307 11%

10

Defined at the 6-digit NAICS level 11

Source: EMSI QCEW and Self-Employment 2013.4

Grown 28.1%

Stayed about the same

61.2%

Declined 6.2%

Don't know/ Refused

4.5%


14

All Other Travel Arrangement and Reservation Services and Convention and Visitors Bureaus are each expected to lose over a quarter of total jobs in the next three years. Although Casino Hotels do represent a relatively small proportion of total Hospitality and Tourism jobs (209), the industry is expected to lose over four fifths of its total jobs by 2016. Table 3: Top Ten Declining Industries by Change in Total Jobs from 2013 to 201612

Description 2013 Jobs

2016 Jobs

Change %

Change

All Other Travel Arrangement and Reservation Services 3,939 2,835 -1,104 -28%

Convention and Trade Show Organizers 2,757 1,942 -815 -30%

Travel Agencies 7,459 6,729 -730 -10%

Caterers 10,679 9,991 -688 -6%

Casinos (except Casino Hotels) 7,772 7,126 -646 -8%

Tour Operators 1,831 1,588 -243 -13%

Casino Hotels 209 40 -169 -81%

Convention and Visitors Bureaus 315 199 -116 -37%

Bed-and-Breakfast Inns 364 287 -77 -21%

Scenic and Sightseeing Transportation, Water 971 901 -70 -7%

Not surprisingly (given that restaurants account for nearly 61% of all Hospitality and Tourism Jobs in Southern California), the top five occupations by employment in Hospitality and Tourism are all food service occupations. Waiters and Waitresses and Combined Food and Preparation Workers represent over 30% of all jobs in the industry cluster.

12

Source: Source: EMSI QCEW and Self-Employment 2013.4


15

Table 4: Staffing Patterns for Hospitality and Tourism in Southern California, 201313

Occupation

Employed in Industry

Group (2013)

% of the Total Jobs in

Industry Group (2013)

Average Annual

New Jobs

Average Annual

Replacement Jobs

Combined Food Preparation and Serving Workers, Including Fast Food 121,658 15.34% 3,121 3,324

Waiters and Waitresses 121,179 15.28% 2,895 5,486

Cooks, Fast Food 53,446 6.74% 1,189 1,054

Cooks, Restaurant 52,633 6.64% 1,331 986

First-Line Supervisors of Food Preparation and Serving Workers 37,082 4.67% 1,024 884

According to EDD estimates, the Waiters and Waitresses occupation requires 8,381 positions filled in Southern California on an annual basis (2,895 new jobs and 5,486 replacement jobs), while the Combined Food Preparation and Serving Workers, including Fast Food occupational category is estimated to demand nearly 6,500 new workers on a yearly basis. Entrepreneurship and small businesses are very important to the sector. As seen in Figure 7 below, a majority of businesses in the cluster have fewer than five employees. Many of these small businesses are recently established to serve not only tourists but also other tourism-related firms. Figure 7: Hospitality and Tourism Percentage of Permanent Employees by Size

13

Sources: EMSI QCEW and Self-Employment 2013.4and California Economic Development Department’s (EDD) 2010-2020 average annual occupational new and replacement job estimates 2012

100 or more permanent

employees 7.9%

50 to 99 permanent employees

9.0% 25 to 49 permanent employees

18.0%


27.0%


21.9%

Less than 5 permanent employees

16.3%


16

Incredibly, these figures do not account for any jobs in a related cluster, Retail Trade. Retail Trade establishments employ 841,194 additional workers in Southern California, and many of the 43,101 retail establishments serve the Hospitality and Tourism clientele. This study excludes retail workers because there is not a well-defined methodology for calculating only those retailers directly associated with tourism (and so that the report does not over-inflate employment totals). However, many of the skills are cross-sectoral and clearly some important tourism-related jobs are left out of this report. This only increases the importance of the cluster to the region’s economy and workforce.


17

WAGES No discussion on the Hospitality and Tourism cluster is complete without a review of wages. The average earnings reported by the Bureau of Labor Statistics and the California Employment Development Department are both quite low at around $24,000 per worker annually. These low wages are often cited as the primary justification for not selecting the cluster as an area of for education, workforce, and economic development.

A cursory review of the official statistics seems to bear out the challenges, highlighting many low wage, entry-level jobs. However, common sense immediately suggests problems with these data. Most people believe (at least anecdotally) that servers and other tipped employees underreport their tips. This seems highly likely given that publicly reported data indicate that fast food preparation workers earn $.07 more per hour than waiters and waitresses.

A deeper review of the cluster further illustrates how skewed and incorrect the publicly available data are regarding wages because of under-reporting of tip earnings. As nearly 22% of the total workers in the cluster are tipped restaurant employees, the reality of wages in this cluster is in fact quite different than it first seems.

California minimum wage laws do not allow tip-credits, meaning that employers cannot offset the minimum wage with tip income. As a result, the absolute floor of employment in the cluster is $8.00 per hour, the state’s current minimum wage. The reported median wage for waiters and waitresses is $8.97, which translates to an average of $0.97 per hour in tip income. This also means that half of all waiters and waitresses –according to the “official” statistics –earn less than a dollar per hour in tips.

Even using a conservative estimate that the median waiter takes home 10% of sales in tips, these data suggest that half of all servers are selling less than $9.70 worth of food per hour, or $78 in an eight-hour shift. While this seems implausible, the data on restaurant sales make it in fact, impossible.

Continuing on the example of waiters and waitresses, a fairly simple calculation presents a much more likely scenario. Full-service restaurants, which employ over 100,000 of the 121,000 servers in Southern California, had sales of $18.7 billion in 2012. Even using the conservative estimates that 20-30% of the total sales were non-tipped, take out business, and that the servers only cleared 8-10% on average after sharing their tips with other workers, the average waiter or waitress earns between $6.55-9.35 per hour in tip income. This, added to the minimum base wage of $8 per hour suggests that the average wage for a server is between $14.55 and $17.35 per hour, significantly higher than the EDD reported $8.97.

In fact, the real impact of tips for just full-service restaurants and drinking establishments, and therefore excluding tips at hotels for room service, in-hotel dining rooms, restaurants, and bars, cleaning staff, as well as workers at limited service restaurants, amusements, and other related businesses, raises the average wage of the cluster by about $2,200 per year. While it is not argued that Hospitality and Tourism jobs are high paying, it is clear that they are not nearly as low-wage as many would suggest.


18

HOSPITALITY AND TOURISM SKILLS AND PREFERENCES The economic and employment impact of the Hospitality and Tourism cluster are clear, but there are other important lessons to learn from the research. The first and perhaps most important is that Hospitality and Tourism jobs have at their core the very skills that employers in every industry crave. Successful Hospitality and Tourism workers are constantly developing 21st century workplace skills such as customer service, problem solving, and communication.

These skills became especially apparent when firms were asked about the type of skills they seek and develop for internal promotion. Over half of all responding businesses said that team work, oral communication, and problem solving were important skills when considering promotion of a current employee into a non-entry-level position. Figure 8: Importance of Skills for Non-entry-level Promotion

Promotion is a real opportunity in this cluster. When looking to fill non-entry-level positions, over 54% of surveyed businesses said that they promote from within at least half of the time. Only 13% of employers promote for non-entry-level positions either “rarely” or “never.”

2.8%

10.6%

11.3%

15.6%

16.3%

24.8%

36.9%

51.1%

53.2%

54.6%

0% 20% 40% 60% 80%

None of the above

Flexibility

Entrepreneurship

Written communication

Analytical ability

Technical skills specific to position

Work ethic

Problem solving

Oral communication

Team work


19

Figure 9: Frequency of Promotion for Non-entry-level Positions

At the same time, employers proved to be pickier regarding their new hires than is sometimes assumed. Hospitality and Tourism employers attributed the highest level of importance (96% importance) for entry-level job candidates’ ability to demonstrate non-technical skills such as communication, work ethic, problem solving, and teamwork. Roughly three quarters of businesses said that at least one year of industry related experience and technical experience and expertise specific to the position they are applying for were important for entry-level candidates. The percentage of employers that rated non-technical skills as “very” important (84%) was more than double those that rated one year of industry related experience as “very” important (35%) and nearly three times as much as respondents that rated technical training and expertise specific to the position they are applying for as “very” important (28%).

7.9%

6.2%

6.7%

24.7%

32.6%

21.9%

0% 20% 40%

Don't know/ Refused

Never (0% of the time)

Rarely (1% to 24% of the time)

Sometimes (25% to 49% of the time)

Frequently (50% to 74% of the time)

Always (75% to 100% of the time)


20

Figure 10: Importance of Experience and Training for Entry-level Job Candidates

Meanwhile, one in seven employers report great difficulty finding workers, and another 35% report some difficulty.

16.9%

28.1%

34.8%

83.7%

25.3%

36.0%

46.1%

39.9%

12.4%

61.2%

41.6%

22.5%

20.8%

0% 20% 40% 60% 80% 100%

A four year college degree orhigher

An industry recognizedcredential

Technical training andexpertise specific to the

position that they are applyingfor

At least one year of industryrelated experience

Demonstrated non-technicalskills such as communication,work ethic, problem solving,

and teamwork

Very important Somewhat important It depends Not at all important DK/NA


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Figure 11: Difficulty Finding Entry-level Job Candidates

The new world of work requires new connections among businesses, K-12 classrooms, community colleges, universities, and training providers. These new collaborations must connect core workplace skills, academic achievement, vocational and technical skill development, and career navigation in new ways. These structural changes should reflect the changing landscape and reflect the new realities of the 21st century. Mostly gone are the days of large employers hiring entire cohorts of similarly trained workers. Increasingly, employers require specific skill sets, industry-specific knowledge and experience, and also a foundation of core academic and problem solving skills. This, in addition to the well-documented workplace skills deficiency, presents challenges for colleges attempting to create relevant and valuable programs for its local industries. Meanwhile, technology and other structural changes have altered the way that employers recruit workers, meaning that community colleges need to be sure that they have appropriate recruitment networks to obtain jobs. Students are becoming savvier and increasingly seek programs that boast high employment after graduation. Finally, there appears to be, as Professor Enrico Moretti has called it, a “New Geography of Jobs,” where high tech islands create great peaks of economic and labor activity, with great valleys in the middle where jobs are scarce. This uneven development of jobs and economic activity has implications across all industries, including Hospitality and Tourism. Clearly, with so many new moving parts, re-emphasis on sector-focused business liaisons are critical. Thankfully, this need is being met with the new “Doing What Matters for Jobs and the Economy” program of the California Community Colleges. Doing What Matters incorporates Sector Navigators who focus on any one of the 10 industries

Little to no difficulty

50.6%

Some difficulty 34.8%

Great difficulty 12.9%

Don't know/ Refused

1.7%


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identified by the Chancellor’s Office as Priority and/or Emerging14 sectors in specific regions (and as selected by participating colleges in each region throughout California). The key to success for the Sector Navigators include:

1. Focus on colleges’ value to employers and consistently prove it; 2. Adapt and be flexible by responding to employers’ needs; 3. Recognize changing economic landscapes and changes within sectors; and 4. Recognize that placing graduates into jobs is paramount.

Specific to Hospitality and Tourism, a startling 78% of surveyed firms in Southern California indicated that they did not have any relationships with high school or college career and technical education (CTE) programs or Regional Occupational Programs (ROP). At the same time, employers may find it useful to connect with local colleges and training providers to help fill their needs more easily. Conversations with local businesses should start immediately to determine if this poor showing is due to a lack of demand (and therefore necessary changes) or awareness, requiring more deliberate marketing and networking by colleges to area businesses. This figure must improve for colleges to remain relevant as workforce and vocational training providers. Figure 12: Relationship with CTE or ROP

14 As will be noted in the Pathways section, traditional industries provide many more opportunities for graduates of Community College CTE and Academic programs than emerging ones.

Yes 18.0%

No 77.5%

Don't know/ Refused

4.5%


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CAREER PATHWAYS One of the most profound issues facing higher education, vocational training providers, and workforce development agencies is how to prepare workers for sustainable careers that pay a living wage. It has been well reported that the U.S. labor force is moving rapidly from a bell shape to an hourglass one, with an erosion of middle class jobs and an abundance of low-wage, low-skill jobs (or, in the case of our innovation sectors, very high-wage and skill jobs). This trend is especially true in Southern California.

The hourglass economy has tremendous implications for how we prepare workers for careers because the career ladders that seem so elusive for jobseekers are in fact broken in the middle. Ultimately, this requires new models and careful consideration of which industries make the most sense for vocational and shorter-term academic training.

Careful selection of target industries is important because the hourglass effect is much more pronounced in the innovation, export-oriented industries that are often the focus of economic developers. More and more often, such industries are made up of firms that either require low-skill, low-wage workers, or highly skilled graduates of elite universities – and many fewer workers in the middle. This is especially important for community college and public workforce system consideration because the typical graduate falls in between, which is an area of fierce competition due in part to increased outsourcing.

In order to best meet these needs, given limited resources and increased emphasis on short-term training, community colleges can maximize their value by focusing on industries best defined by a bell-curve model rather than the “J” model which is often more associated with industries requiring advanced degrees. In comparison, Hospitality/Tourism is more like Healthcare, a population-serving industry that is already well-served by the community colleges, and rather nothing like Biotechnology, which has certain niche components for community colleges (see Miramar College’s Biotechnology Center) but many fewer opportunities for community college graduates.

The charts below illustrate the very different wage structures of innovation/export industries and traditional, population serving ones, by comparing two related industries, biotechnology and healthcare. Note the bell shaped curve in healthcare, illustrating numerous middle class opportunities, and the J-shaped curve of biotech, which is predominantly made up of high-wage jobs (these two clusters were selected due to their similar focus on health, and for their pronounced difference between export/innovation and traditional/population-serving natures).


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The second important distinction between population-serving and export-oriented industries is that the higher end jobs in each have very different job requirements. Typically, more traditional industries value work experience and customer-centric skills, while innovation industries seek advanced degrees (with a bachelor degree from an elite university often a minimum requirement). For community colleges, with only very few exceptions, the primary value-added for innovation industries is in transfer (academic) or mid-career change for experienced candidates who already have a degree from a four-year university.

The healthcare/biotech comparison, using this time degree requirements for illustration, again shows the “sweet spot” for community colleges as much broader in the population-serving healthcare industry.

25%

30%

35%

40%

Low wage Mediumwage

High wage

0%

15%

30%

45%

60%

75%

Low wage Mediumwage

High wage

15%

30%

45%

60%

Low skill Mediumskill

High skill

0%

15%

30%

45%

60%

75%

Low skill Mediumskill

High skill


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A cluster as broad and varied as Hospitality and Tourism is bound to have multiple pathways for career advancement. This report focuses first on three specific pathways that are most relevant to community colleges and their students, based on common types of students and job seekers so that the industry-specific pathway can be tailored to their specific needs. Each pathway is developed in order to focus on sustainable careers and lifelong advancement. At the center of each of the pathways in this cluster are the 21st Century Workplace Skills such as communication, problem solving, teamwork, and customer service.

Career pathways are often thought of as being general to an industry, and are developed in a generic, or even one-size-fits-all fashion. This typically leads to overbroad, theoretical pathways that do not work for many for which they are intended. The industry-specific approach that is detailed later in this section addresses employer demands, but, equally important, it includes an analysis of the supply of workers and trainees who seek employment in the sector.


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In order to better understand these functional, supply-side pathways, careers are broken into three main categories, with strategies developed for each. These categories include entry-level generalists, which tend to be the lower paid, abundant opportunities in the cluster; specialists, which have key skill sets that are unique to a position or field; and managers. Each pathway includes key skills for entry and promotion, and targeted recommendations for community colleges.

The pathways are also developed with thee specific sets of individuals in mind.

Pathway #1 is for a person with no post-high school credentials or related work experience (such as a recent high school graduate) who must continue to work and earn wages (even at a lower-wage job) throughout his/her career development. This individual requires a longer pathway, flexible scheduling, and career navigation assistance and coaching.

Pathway #2 has also been developed for a person with no post-high school training or related experience, but who is able to attend college full-time. This pathway is shorter and includes more rapid development of academic skills and credentials and incorporates internships and other work experience to complement the educational components.

Pathway #3 is developed for individuals with prior work experience and/or education but who seek a mid-career change, either due to choice or necessity. This pathway is the shortest entry point and focuses on filling specific, industry-related gaps for workers that already have some workplace skills and experience.

CAREER PROFILE PATHWAYS

INDIVIDUAL PATHWAY #1: WORKING UP THE LADDER

Pathway #1 focuses on recent high school graduates and other populations of workers without relevant work experience or post-secondary credentials. This pathway has several components to help individuals obtain an entry-level job in the cluster while continuing in a training program for advancement. It is the longest and most difficult of the pathways, but one where the community colleges can play a vital role and


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incorporate lifelong learning, workplace skill development, vocational training, and academic awards (as well as transfer).

One of the clearest examples of success in action for such a model is the Linked Learning initiative in the public high schools across California and the United States. In fact, there may be no better example of the success of Linked Learning than the Mount Miguel High School Hospitality and Tourism Management Academy in East San Diego County.

This program, which begins in 10th grade, focuses on contextualized learning modules, hands-on experience, and high expectations, culminates in a capstone course that instills entrepreneurialism and professionalism in students. The primary goal for each student is to continue their education to obtain a bachelor degree and the Academy boasts high graduation rates and successful outcomes for its participants.

Not every student has the benefit of an academy, Each component is explained below, and assumes that entrants do not have significant prior knowledge of the industry:

Key Skills for Entry:

Workplace Readiness

The 21st Century workplace requires a customer- and team-focused approach that includes strong communication skills, the ability to solve problems, and solid abilities in teamwork, customer service, and flexibility. Training in this pathway must include active learning of these important skills, including classroom coursework (particularly in writing, speaking, and customer service), active role playing, and career exploration that identifies and illustrates the rigors, expectations, and experiences of Hospitality and Tourism cluster employees.

Many of these skills are currently being addressed by updated and upgraded Student Learning Outcomes (SLOs) for each credit and non-credit class. The development of the new SLOs has been an enormous work effort and a challenge for colleges, but it has been required as part of the new student success initiative and based on the employer feedback collected as part of the study, will be well worth it.

Hospitality and Tourism Industry Learning

This component focuses on the cluster itself and how its industries are organized. It covers the technical training needed for entry-level employment, such as the basics of restaurant, hotel, retail, and other travel and tourism related businesses, and introduction to basic tasks.

In addition to these general support skills, basic training in food preparation, computer and telephone technology, and project management could be useful for trainees.

Key Skills for Promotion

The following are the key skills that programs should develop to ensure upward mobility and career advancement.


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Academic Remediation and Advancement

In addition to the technical and non-technical vocational training, programs would better serve their students by offering academic remediation and advancement. Increased proficiency in core academic skills, such as reading, writing, and mathematics has been proven valuable to career and educational advancement. Modules should be contextualized and offer college credit whenever possible. Additionally, colleges that provide WorkKeys assessments and KeyTrain online basic skills modules will help employers identify skills gaps and determine which candidates are most likely to succeed in the workplace.

Career Navigation and Job-Seeking Assistance

Too often, job placement is focused on a goal of the fastest means to any job. In this pathway, however, a more deliberate approach is appropriate. The first step in this component is to provide meaningful career exploration specific to the various parts of the Hospitality and Tourism cluster. This includes video, on site, and guest appearances of the types of careers available, as well as providing students with information about wages, hours, expectations, and other details of employment in the cluster.

Once students have an overview of the types of careers in the industry, each should be coached on what is required to achieve not only entry-level employment but also promotion to higher wage positions. Doing so helps to ensure that students understand the commitment and steps required to achieve sustainable careers, which may increase their likelihood of completing a longer-term program. It also helps students to make decisions about their entry-level jobs that help them develop towards higher skill careers.

Throughout the research, employers noted the importance of a well-written application and resume, and strong interviewing skills. The most important focus for college programs should be attention to detail and grammar in the resume process, and personable presentation in the interviews. With this information in mind, training programs should focus on highlighting the students’ skills acquired through the program and work with employers to place graduates.

Continuing Education

The most important component for future success is to recognize that the work is not done merely when the first job is obtained. Typically, lower wage, lower skill jobs in any industry have significant barriers to advancement without continuing education. Students should be encouraged to enroll in specific specialist programs (such as culinary arts, IT, design, marketing, etc.) or management programs such as the Community College, Cal State, and Cal Poly Hospitality and Tourism Management degrees (please see the Appendix A for profiles).

Some examples of short-term credentials that have been developed by colleges include Green Supply Chain Management Program at Cuyamaca College through Continuing Education and Workforce Training, the Front Office Specialist Certificate Program at Orange Coast College, and across the state, ServSafe, and TIPS Alcohol training (offered through many culinary arts programs), Guest Service Gold curriculum, (developed by the American Hotel and Lodging Association) and the Retail Management


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Certificate (developed by the Western Association of Food Chains) which are offered by many colleges throughout California.

Required Partners

Mentors from industry

Career services counselors

Video production

Industry management

Advisory Board of Hiring Managers

Foundation for California Community Colleges

INDIVIDUAL PATHWAY #2: FULL-TIME COLLEGE

Pathway #2 focuses on recent high school graduates and other populations of workers without relevant work experience or post-secondary credentials but who will go to college full time. As with Pathway #1, community colleges can play a vital role and incorporate lifelong learning, workplace skill development, vocational training, and academic awards (as well as transfer), and can leverage its industry relationships for internships and cooperative learning.

Each component is explained below:


Technical Proficiency

Unlike with entry-level jobs, graduates from college programs (certificate or degree) will expect and be expected to bring technical skills to the table as either a specialist or manager. College credit is key for continued development. Students’ placement will depend on their own desires, but also the level of experience that they receive in the program (see below section). A few examples of technical skills include:

Culinary Arts

Marketing and Advertising

Management

Accounting

Business

Workplace Readiness

This pathway requires the same 21st Century workplace skills centered on customer service, teamwork, communication, and problem solving. Training in this pathway is


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especially important since unlike in Pathway #1, students will be entering middle skill jobs without a full complement of work experience. This should include classroom coursework (particularly in writing, speaking, and customer service), active role playing, and career exploration that identifies and illustrates the rigors, expectations, and experiences of Hospitality and Tourism cluster employees.

As noted previously, most college course work include SLOs and contextualized curriculum along with internships or a community based project that allows students to get hands-on experience. This demonstrates that the colleges are listening to the business community in requiring some actual work experience in their field prior to graduation, and should be marketed to students and employers alike – and refreshed frequently in response to employer demand.


This component focuses on the cluster itself and how its industries are organized. It covers the technical training needed for entry-level employment, such as the basics of restaurant, hotel, retail, and other travel and tourism related businesses, introduction to basic tasks. Unlike in Pathway #1 where this can be done in a general manner, rather the components of each technical and academic module should be customized and contextualized to specific hospitality and tourism segments.

Internships and Cooperative Learning

This component is key to complement the industry learning, and to develop a preliminary work history. Students should be encouraged to complete several rotations that differ by scope, size of business, and type of customer. These on-the-job training internships should be coordinated by the colleges and offer an excellent introduction to the industry while providing good value to area Hospitality and Tourism businesses.


A student with a credential or degree has a significant “leg up” on other applicants in the industry. This is particularly true of students who have gained valuable industry experience through internships and work history. However, the resume and interview are still critical pieces and should be customized for every opening.

One key to success for the community colleges in preparing students in this pathway is understanding the importance of lifelong learning in career navigation. Students can always be served by continuing their education, and colleges should encourage students to continue their academic careers to obtain an associate and eventually bachelor degree in a related field.

Required Partners

Industry internship coordinators


Industry management


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INDIVIDUAL PATHWAY #3: CAREER TRANSITION

Pathway #3 focuses on mid-career transition. These individuals have significant work histories but are either by preference or layoff seeking new careers in Hospitality and Tourism. The key to best serving this type of student is to provide short-term certificate training and highlight comparable and transferable skills from their previous experience.

Each component is explained below:


Technical Proficiency

While the best bet for mid-career, experienced candidates are management positions, technical requirements would need to be met for specialists. If candidates do not have any post-secondary or related credentials and seek to work in a specialist occupation, it is likely that a full academic program would be required (Pathway #2). For those with degrees (such as marketing, business, management, etc. or experience managing people), the key component is Industry Learning.

Workplace Readiness

It is assumed that mid-career workers have ample workplace readiness, though contextualized focus on customer service and communication is always a benefit. A few updated skills relative to technology and social media are also more often appropriate for this type of worker.


This component focuses on the cluster and how it operates, to offer specific insight for how to apply previously obtained skills to this cluster. Activities would include classroom learning (especially focused on the business aspects of each segment), management and human resources issues specific to the cluster, and active role playing and problem solving.


This student typically needs assistance highlighting his or her previous skills and how those skills are valuable in the Hospitality and Tourism cluster. Specific emphasis on problem solving and management, as well as attention to detail and teamwork are critical. Finally, students should build portfolios that include their value proposition to the employer in a clear and concise manner, with specific examples from their previous work and more recent training.


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Required Partners


Industry management



INDUSTRY PATHWAYS

Each industry segment has its own pathway, despite the common core of skills at the center. Each infographic below illustrates the key pathways by industry sector.

INDUSTRY PATHWAY #1: FOOD AND BEVERAGE


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INDUSTRY PATHWAY #2: ACCOMMODATIONS AND LODGING


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INDUSTRY PATHWAY #3: EVENT AND CONFERENCE PLANNING


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INDUSTRY PATHWAY #4: TRAVEL SERVICES


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INDUSTRY PATHWAY #5: ENTERTAINMENT AND ATTRACTIONS


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CONCLUSIONS AND RECOMMENDATIONS The Hospitality and Tourism cluster is a large and growing sector that offers a wide variety and vast number of employment opportunities to residents of Southern California. The economic and workforce impacts illustrated in this report are dramatic, and the career pathways are well defined and sustainable. In addition to these important attributes, the Hospitality and Tourism cluster is vibrant and exciting. Workers can expect to meet new people, work in beautiful environments, and tout the many attributes of their local communities.

While educators have long recognized the number of jobs in the cluster, many regions have turned their focus away from Hospitality and Tourism and towards newer, emerging sectors. Often, such decisions are made based on Hospitality and Tourism’s lower “official” wages, which, as demonstrated in this report, are artificially low due to the exclusion of most tip-related income. In fact, Hospitality and Tourism includes more middle-skill and middle-wage jobs in Southern California than in any “new and emerging” sectors in the region.

While not specifically included in the figures for this report, the retail sector includes more than 840,000 jobs with a median wage over $35,000. Many of these retail establishments are closely connected to tourism and many of the skills are cross-sectoral. As a result, the production of high quality Hospitality and Tourism workers has benefits outside of the cluster itself.

This report indicates that key workplace skills, already the focus of the Workplace Learning Resource Centers, are critically important to entry-level Hospitality and Tourism employment. Work experience, management skills, and specialized education and training for the many specialist occupations provide ample opportunities for successful career navigation. With many small businesses and entrepreneurs in the sector, developing modules for business essentials is also a significant value-add for the colleges. Providing these workplace skills, industry awareness and experience, and core academic proficiency is a winning formula for successful community college programs for the cluster.

Beyond the demand for skills, it is imperative that community colleges consider the “supply-side” of entrants into their programs. Each trainee should be evaluated and offered appropriate services to meet their specific needs and goals. Specifically, different pathways should be created for students on a traditional track, those who will work while in school, and those in a mid-career transition. This customization will provide more efficient and effective pathways to employment by tailoring training to meet the specific needs of students.

Southern California remains a popular tourist destination. Its abundant natural beauty, entertainment, and near-perfect weather will continue to draw visitors, and their spending power, to the region, yet competition is fierce and expectations are high. Employers will need a deep and talented workforce to meet the needs of the growing industry. The California Community Colleges are perfectly positioned to meet these needs and should continue their strong focus on the cluster and continually market their programs and students to the employers in their regions.

Economic Modeling Specialists International | www.economicmodeling.com A-1


APPENDIX A – COLLEGE PROGRAMS

Southern California Tourism Study - 4 county | Training Providers

31 3,179

Institutions Completions (2011)

Institution Degrees Certificates Total

Completions

Le Cordon Bleu College of Culinary Arts-Pasadena 718 426 1,144

Long Beach City College 8 313 321

California State Polytechnic University-Pomona 256 0 256

Cypress College 28 157 185

University of Antelope Valley 30 140 170

Los Angeles Trade Technical College 28 107 135

San Diego Culinary Institute 0 125 125

San Diego State University 115 0 115

The Art Institute of California-Argosy University San Diego 110 0 110

The Art Institute of California-Argosy University Orange County

57 32 89

Grossmont College 30 34 64

Orange Coast College 13 47 60

The Art Institute of California-Argosy University Los 47 8 55

Economic Modeling Specialists International | www.economicmodeling.com A-1


Institution Degrees Certificates Total

Completions

Angeles

Cerritos College 5 46 51

MiraCosta College 8 29 37

San Diego Mesa College 9 23 32

San Diego Continuing Education 0 30 30

Saddleback College 5 21 26

Los Angeles Harbor College 1 24 25

Southwestern College 9 11 20

University of Southern California 0 19 19

Baldwin Park Adult & Community Education 0 18 18

College of the Canyons 12 5 17

Mt. San Antonio College 6 9 15

Los Angeles Mission College 10 4 14

California State University-Long Beach 12 0 12

Pasadena City College 0 11 11

West Los Angeles College 3 6 9

Bristol University 0 8 8

Glendale Community College 2 2 4

Palomar College 1 1 2


B-1

APPENDIX B – DATA SOURCES Data Sources and Calculations

Institution Data The institution data in this report is taken directly from the national IPEDS database published by the U.S. Department of Education's National Center for Education Statistics.

Completers Data The completers data in this report is taken directly from the national IPEDS database published by the U.S. Department of Education's National Center for Education Statistics.

State Data Sources This report uses state data from the following agencies: California Labor Market Information Department


C-1

APPENDIX C – CALIFORNIA STATE UNIVERSITY PROGRAMS

http://www.wplrc.com/app/doc/HMEI_2012Series_P4.pdf

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