By Luke Butler, managing director of Hastings People

Have we ever seen a persistently challenging market like the one we have had over the last three years?

If I think back to my time working in operations, aside from the GFC, I can’t remember a time where businesses have had to respond to so many variables in their day-to-day trading conditions.

Obviously there was covid, then a full switch to boom-time when operators relished the high level of trade buoyed by pent-up demand, low interest rates and household high savings. Then in January 2023 fears of a recession loomed on the back of inflations and rate rises, which created more caution than it did impact consumer spending by and large.

Now, we are seeing the impacts of the cost of living playing a larger role in consumer behaviour, which is offset by lower inflation pressure and a lingering sense of optimism.

The impacts on the labour market are showing and softer trade is present across many parts of the market.

We spoke a lot about the resilience of the industry which survived a total shut down and near catastrophic trade environments (shut down, re-open, no dancing etc), but here we are today, still applying a mindset of resilience to a whole new set of challenges. I can’t recall a time when this level of mental fortitude was required in our sector.

So, what do we have to look forward to in 2024?

Firstly, I am no economist and there is such inconsistency in what operators are experiencing, that it’s hard to forecast a universal outcome, but there will be some trends that I believe will touch all.

On the talent front, there will certainly be an easing of pressure in the access to staff at the junior end of the market across 2024. We have seen a large influx of backpackers who have soaked up the exceptionally large number of vacancies in the casual work force that were evident in 2021 and 2022.

The availability of mid-level talent has improved too. That being said, the demand for assistant-level management either back- or frontof house, remains high, particularly in more premium or complex venues.

Where we see the least amount of slack in the market is in the high-level, high-skill roles, again within premium or complex operations, where the higher volume of workers available does not result in a higher volume of skill being available. No change to the economy will increase the amount of skill in the market.

Salaries should begin to further normalise this year for a couple of reasons. Firstly, the perceived risk of not having a job in a sliding economy will reduce the appetite to negotiate for some.

Secondly, uncertainty in the economy will mean that many seek stability in their employment, rather than shifting for a job with which offers slightly more money. There will always be exceptions to this, but I believe we are already seeing this trend play out.

Trade is a tough one to predict given the economic factors that influence it. People were happy to spend money over the holidays so we are coming off the usual summer glow. February is traditionally softer as we get back into our rhythm with work and school etc, but with sport returning across multiple codes, the desire to hit the pub will again be high.

It is clear from multiple sources that pubs will continue to perform, due to the relatively low cost associated with product. Higher end restaurants who basked in the sun of post-covid craziness will invariably be the ones that find it tougher in the coming six months, with punters seeking to go out in lower-cost experiences.

The tried and true pub special, coupled with entertainment options will surely continue to appeal, scratching the going out itch while not hammering the wallet too much. The challenge is delivering wallet-friendly offers when the cost of running a venue continues to increase.

For the industry as a whole, it would be ideal to avoid a race to the bottom on pricing, which we have seen in the past when times get tough.

Finally, from a leadership perspective I believe the sector as whole needs to appreciate what we have all been through. The resilient resilience required to navigate the last four years has and will continue to take its toll on staff and owners alike.

Maintaining the level of care for teams, similar to that which was shown at the very beginning of covid, will only serve to create a better industry, once we are through what is hopefully the final hurdle before we resume regular programming.

Vanessa Cavasinni

Vanessa Cavasinni is the managing editor of Australian Hotelier and Club Management, trade publications for the pub and club sectors respectively. Vanessa has been at the helm of Australian Hotelier since...

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