Tourism industry recovery slower than expected, one month after reopening

A month after Malta reopened to tourism, the local industry is still far from reaching 60% of 2019 tourist arrivals, a month-for-month target that industry leaders had been aiming for, BusinessToday has learned.

Tony Zahra, president of the Malta Hotels and Restaurants Associations, told this newspaper that June got off to a slow start with England having placed Malta on its travel amber list.

With English tourists making up for more than 33% of all tourists arrivals in 2019, June figures were instead buoyed by a strong showing by the German and French markets, he said. This did not make up for the UK shortfall but did boost arrivals considerably.

Malta International Airport yesterday reported tourist arrivals in June stood at 190,505 passengers, a drop of 73.6 per cent compared to June 2019, although an improvement over the traffic handled in the previous months.

“Before reopening, we had set ourselves a target, we were looking at reaching 60% of the 2019 arrivals, month for month,” Zahra said. “We are not there yet but I am confident that, if the situation does not deteriorate in these vital markets, we still stand a sporting chance of reaching our target this year.”

He said that once the UK moved Malta to its travel green list, bookings and arrivals from the UK made the end of June more positive for local operators. Italian arrivals were also starting to pick up, he said.

As to reports of operators in the hospitality industry facing serious staff shortages, Zahra said this was an issue that operators all across Europe were having to deal with.

“With the onset of COVID-19, many people employed in hospitality sought alternative employment after months of inactivity,” he said. “Now that the industry is slowly reopening in many countries, many of those former employees are choosing to remain at their new jobs and not move back to their previous positions.”

Zahra, explained that with many countries and operators to reopening at the same time, it would take some time before things went back to normal.

Additional costs

Philip Fenech, deputy president of the Chamber of SMEs, agreed that staff shortage was a major headache for many in the industry, but said this was merely one of many hurdles in the way to profitability.

He said that for the past few years now, it had become apparent that Maltese were shying away from working in the hospitality industry, leaving employees having to employ foreigners to fill full-time and a casual positions.

“This is not about the Maltese not wanting to work as waiters, but about them not wanting to work late into the evening, on weekends or on public holidays,” he said. “It is why there is now a serious shortage staff at all levels - from chefs and mixologists to kitchen hands and waiting staff.”

Fenech said that many workers had left Malta as COVID-19 forced the closure of hotels, as well as the catering and entertainment industries. Some of those workers were now waiting for better conditions in their own countries before returning to their jobs in Malta. Others lived in countries that were still on Malta’s amber or red travel lists.

“And with the situation we find ourselves in, employers are in no position to guarantee full-time employment on a fixed contract to many workers,” Fenech said. “That too is keeping foreigners away for the time being.”

He said it was ironic that, because of the current mitigating measures that remain in place affecting the industries, many operators were actually in need of more staff than they employed before COVID-19 hit.

“With outlets not able to offer self-service or bar service, more staff are needed to cater to patrons, even though outlets have been forced to cut the number of covers because of social distancing regulations,” Fenech said.

Hotels, for example, cannot offer buffets and self-serve breakfasts and therefore need more staff to cater to guests. Bars, which at the moment can only serve sitting customers, need more staff to take and deliver orders. And other establishments need additional staff to provide additional security inside the businesses and to man the doors to ensure that the number of patrons allowed inside does not exceed regulations.

Fenech said that the SMEs Chamber had even recommended to authorities that bars be allowed to serve customers at the bar, if adequate perspex shields are installed. But this propsoal has thus far been shot down by the relevant authorities.

“Operators now have to bear higher costs, but at the same are limited in the earnings they can make because of the reduced seatring and patronage regulations,” he said. “This is putting additional strain on business to remain profitable even as they see things improving with measures being increasingly loosened and people returning to dining out, staying at hotels and visiting places of entertainment.”