Study: Estonian tourism sector needs greater flexibility

  • 2023-01-16
  • BNS/TBT Staff

TALLINN – The results of a study commissioned by the Ministry of Economic Affairs and Communications reveal that Estonian entrepreneurs believe that the several years of the COVID-19 pandemic and the rise in energy prices have negatively affected the reputation of employers in the tourism sector and reduced the availability of the necessary workforce.

According to the results of the study, perceived solutions include automation, flexible employment contracts and greater cooperation in the field of education.

"Since 2020, the tourism sector has gone from crisis to crisis and many experienced workers moved to other fields during the COVID-19 pandemic, which has increased the labor shortage in the sector," Minister of Entrepreneurship and IT Kristjan Jarvan said.

According to Jarvan, the tourism sector is competing for workers with many other sectors that value similar skills and experience.

"At the same time, it is a joy to see that 2022 was a successful year for tourism and that more and more foreign tourists are finding their way to Estonia again. This means that companies in the sector have been smart in finding new solutions in a changed situation. The state and entrepreneurs will undoubtedly continue to cooperate in the future to find sustainable solutions to labor issues," the minister added.

According to the minister, post-pandemic recovery will be a test for both governments and employers on how to reorganize the tourism sector and adapt to changes. The main challenges include the domestic reputation of the sector, labor shortage and also education.

"The COVID-19 pandemic highlighted the need to automate and digitize services and their provision. This requires both new skills from people working in the field or those starting work there as well as a change in the employers' way of thinking," Jarvan said.

The purpose of the labor and skills requirement study conducted by HAAP Consulting was to find out what skills and competencies and how many employees the Estonian tourism sector will need in the near and distant future and what are the opportunities for policymakers to influence the labor market and the education and skills of employees.

Entrepreneurs and professional associations of the tourism sector, higher and vocational education institutions offering specializations and trainings in the tourism sector, and public sector institutions involved in the development of tourism policy participated in the study.

The study shows that several years of the COVID-19 pandemic have negatively affected the reputation of employers in the tourism sector, which has made it increasingly difficult to recruit employees.

The popularity of tourism education has declined in recent years and majoring in tourism can seem like an uncertain choice. For example, several study programs in the field of tourism did not open admissions in 2022.

Education providers and employers in the field of tourism see the need for systematic cooperation, for example learning could be more flexible and internships could be paid. There has also been an increase in the interest of both employees and employers in flexible forms of work, such as variable hour contracts and part-time or seasonal work with several different employers.

Entrepreneurs are also interested in recruiting foreign labor, including, for example, Ukrainian refugees, and supporting their language learning, as the tourism sector is a good opportunity to enter the labor market and learn the language. At the same time, the employers pointed out that although it is important to ensure service in Estonian, this does not mean that all service staff must have a good command of the language. In addition, it was pointed out that there could be more language learning opportunities offered by the state.

Killu Maidla, CEO of the Estonian Hotel and Restaurant Association, said that the hotel and restaurant management is a very labor-intensive form of business and the ever-increasing labor crisis is making entrepreneurs concerned.

"The results of the study clearly confirmed the previous messages of entrepreneurs, but also highlighted new insights and perspectives. Tourism education needs to be modernized, and cooperation between companies and schools is crucial here -- as an association, we have already taken the initiative here, and I believe that if the expectations of entrepreneurs are taken into account more, we can do a lot here," Maidla said.

According to her, the Employment Contracts Act needs to be amended as well, because people expect increasingly flexible employment relationships.

"Companies are ready to agree on flexibility, employees are waiting for it, now we are waiting for the law to catch up with it," Maidla said, expressing hope that the study will also enable the long-awaited changes to be initiated.

Under the leadership of the Ministry of Economic Affairs and Communications, the implementation of the study's recommendations will begin in cooperation with the Ministry of Education and Research, the Ministry of Social Affairs, schools and employers in the tourism sector.