While the COVID-19 pandemic wreaked havoc across all aspects of the economy, the hospitality industry took an especially vicious hit, with its profits decimated and much of its workforce laid off in wake of the catastrophic drop in travel.

However, new reports from the American Hotel and Lodging Association (AHLA), in partnership with Oxford Economics, project that the hospitality industry is on track to resume pre-pandemic levels of business activity in 2023.

“Hotels are making significant strides toward recovery, supporting millions of good-paying jobs and generating billions in state and local tax revenue in communities across the nation,” said AHLA President & CEO Chip Rogers. “To continue growing, we need to hire more people. Fortunately, there’s never been a better time to be a hotel employee, with wages, benefits, flexibility and upward mobility better than ever before.”

For Alabama in particular, the Oxford Economics analysis shows a surprisingly strong recovery for our state’s hospitality industry, with a corresponding influx in tax revenue for state and local governments.

In 2019, the hospitality industry brought in $266,558,026 in tax revenue for Alabama’s state and local governments. Barring unforeseen catastrophe, Oxford Economics projects that the hospitality industry will bring in an estimated $311,406,744 in 2023 – a 16.8% increase of pre-pandemic levels.

An additional $44 million in tax revenue is nothing to sneeze at, to say the very least.

Where the hospitality industry has been struggling in its recovery is in meeting the staffing needs of these hotels. Staffing took a hard hit as hospitality businesses struggled to keep afloat, and hiring has yet to replace the employment numbers of the industry’s pre-pandemic levels.

The projected employment of both direct and indirect employees in the hospitality industry is expected to remain 9.7% lower than 2019. However, the need for these businesses to meet their staffing requirements has resulted in a raise in pay and benefits, in order to attract workers.

According to the AHLA, the national average wage of direct employees of the hospitality industry rose to $23 per hour in December of 2022, and this number is expected to increase through 2023.

The AHLA is also seeking to meet workforce needs by its affiliated “Workforce and Immigration Initiative,” which is lobbying for a national, bipartisan immigration reform in order to legally incorporate more immigrants into the American workforce and economy.

“Recruiting enough workers continues to be the top challenge for many hoteliers, and this is leading to historic career opportunities for hotel employees,” said AHLA President & CEO Chip Rogers. “AHLA and the AHLA Foundation are working tirelessly to grow the industry’s talent pipeline and retain workers through innovative events like National Hotel Employee Day and compelling ad campaigns like ‘A Place to Stay,’ but there is still more to be done. We need Congress to help address workforce shortages with bipartisan solutions to incorporate more immigrants into the American economy.”

These measures may prove to be unpopular in Alabama, which has a history of strict immigration laws. Back in 2011, the state legislature enacted HB 56, which required law enforcement to check the immigration status of anyone that they detained and suspected of being in the country illegally, with immigrants being required to carry their immigration documents with them at all times.

The legislation had a devastating effect on Alabama’s economy; crops rotted in the fields as overwhelmingly-Hispanic agricultural workforces vanished, hotels were massively understaffed, and American workers failed utterly to fill the niche voided by undocumented workers fleeing the state. A study by University of Alabama economist Samuel Addy estimated that the crackdown cost the state billions of dollars in lost state sales and income taxes, with millions also lost for city and local taxes.

It remains to be seen if Alabama will continue its pattern of anti-immigration crackdowns, or if the prospect of increased prosperity, brought forth by entities like the American Housing and Lodging Association, can alter hardline stances in state and Federal legislatures.