/ Interview with Ms. Susanne Kraus-Winkler, President of HOTREC

The hospitality industry employs 10 million people in Europe, i.e. 80% of the total tourism workforce. During the last decade, the sector created 2.5 million jobs: a 29% growth versus the 7% in the overall economy, and still keeps creating tens of thousands of jobs every year. However, the hospitality industry could be an even stronger driving force for job creation and growth. Susanne Kraus-Winkler, President of HOTREC, presents HOTREC’s 2017 proposals to foster jobs and growth. 1) Due to the massive development of digitalisation, the face of tourism has changed dramatically, therefore changing the way we work and the way we connect. According to you, what should the digital agenda achieve for the tourism industry to flourish and how do you envision the role of the EU to make it stronger? With new businesses models in place, tourism offers become even more fragmented and new forms of competition have emerged, bringing a set of new opportunities and challenges. As tourist arrivals grow by 4% on average per year in Europe, tourism has a bright future, and digitalisation acts undoubtedly as a driver for market growth. However, platforms are still unregulated and unfair commercial practices in B to B relationships directly affect the whole tourism value chain including 1.7 million hospitality micro-sized enterprises. We trust that the initiatives taken by DG GROW and DG CNECT for online transparency will soon be followed by a set of measures to restore fair commercial practices, therefore allowing for healthy competition. Looking at the contracts between hotels and online travel agencies, after Germany and France, Austria banned parity clauses, therefore restoring the entrepreneurial freedom of hoteliers. We also look forward to the results of the surveys conducted by national competition authorities on potential market distortions by online travel agencies. Last but not least, considering short term rentals, the HOTREC’s Chart towards a responsible and sustainable collaborative economy starts to be implemented, in particular concerning the registration of activity, but we need to go faster as the time of the legislator is not the time of the industry. Urgent action is therefore needed if we wish to keep a vivid and sustainable European hospitality industry! 2) In 2016, the European Commissionhas come up with an action plan to clamp down on VAT fraud and update current VAT rules that have been left unchanged since 1993. The reduction ofadministrative and fiscal burdens is being called upon by all tourism stakeholders alike represented in the Manifesto, whose HOTREC is a Member of the Steering Group. What should be according to you the measures to be taken by the Member States regarding taxation in general and taxes on labour in particular? High VAT is a disincentive. HOTREC will publish a study in the 1^st quarter of 2017, which demonstrates the positive impact of low VAT on job creation and competitiveness. Beyond VAT, all tourism taxes and levies should be reconsidered by authorities in order to maximise competitiveness. High tax wedge on labour constitutes as well a strong disincentive for companies to create more jobs. Especially when taking into account that the hospitality industry is composed for 91% by micro-sized enterprises (1.7 million), high tax burdens on labour constitute not only a barrier to growth and innovation, but also a barrier to invest in further training and to retain workers, and even more to invest in additional workforce. National Public authorities should reduce the tax wedge on labour and shift taxation away from labour. Ensuring a more favourable tax framework for SMEs in the tourism sector will contribute to keeping in the long term Europe as world’s number 1 tourist destination. 3) The hospitality industry as the tourism industry is known for its shortage of skills. What could be done to improve the situation and avoid tens of thousands of jobs being unfulfilled every year? Do you have any proposal regarding seasonality? The hospitality sector is currently facing a huge shortage of skills in particular in ICT. Indeed technological changes have created new needs for instance to manage bookings and customer services. Societal change drive as well new demands, for instance in food services where chefs and qualified personnel are strongly missing. While the average job vacancy rate is 1.7% in the EU, it can reach 4% in Austria and up to 7% in Greece. If you look at EURES, there are currently 433.575 vacancies for cooks out of 208.000 are vacant in Germany. Tourism SMEs are willing to create more jobs but are unable to find the skilled employees they need. This important skills mismatch needs to be addressed. Therefore, EU and national funding should be redeployed to make new investments in further training more attractive for SMEs. Training and upskilling employees is critical to create more employment, deliver quality service, and retain employees in the sector. Online training is part of the answer, as it is accessible everywhere and does not require the trainee to be away from work. The EU, national authorities and social partners should continue promoting the quality, and attractiveness of apprenticeship schemes in the tourism sector. Public authorities and social partners should facilitate the transition from education to work and Partnerships between businesses and training providers, to better meet labour market needs, should be strengthened. Existing tools, such as the European Hospitality Skills Passport, should be further promoted, to ease employers and job seekers match on the labour market. Emerging skills needs should be early detected and anticipated in order to train employees and employers on the industry´s requirements. Indeed seasonality is one of our biggest challenges, the reason why many companies cannot afford to propose permanent working contracts. Moreover, customers expect hospitality businesses to be open outside normal working time, week-ends included. For these reasons flexibility is needed. EU and national public authorities as well as social partners should secure the possibility of using flexible working arrangements. Moreover, a new concept of flexicurity should contribute to maintain the attractiveness of different forms of employment contracts for employers and workers while ensuring adequate protection for workers, to facilitate transitions between them.