The September 11 terror attacks in 2001 against the US remain as one of the most devastating terror attacks in history. After hijackers crashed two airlines into the World Trade Center Twin Towers, 2, 974 people lost their lives. The attacks had great economic impact on the US and the world markets (Stein, 2003). The hospitality industry was not spared either as the US hospitality industry immediately felt the impact of the attacks. All the major players in the industry from restaurants, hotels, to airline companies were greatly affected by the attacks and the short and long term effects of the attacks continued to be witnessed long after the day of the attacks.
The US Hospitality industry before and after the 9/11 terror attacks
Before the September 11 terror attacks on the US, the hospitality industry was very sound economically (Barth, 2001). Based on the industry’s ability before 2001, there were indications that the industry’s profitability was going to increase. The international lodging and the travel industry even exceeded predictions by analysts in terms of growth and profitability. The industry was able to secure record corporate profits before the September 11 attacks. According to top hospitality industry executives, the lodging industry in the US had about 53,500 properties (Campbell, 2002). In addition, the industry had about 4.1million rooms throughout the US. In 2000, the US tourism sector was estimated to provide employment to about 7.8 million people and also provided direct or indirect employment to one out of every seven Americans. When it came to travel-related salaries, the US tourism sector in 2000 paid about $171.5 billion and extra huge amounts of financial resources as taxes. For instance, the sector paid an estimated $99 billion as local, federal, or state taxes in 2000.
Because a large portion of the US Gross Net Product is generated by the hospitality industry, the terror attacks which affected the industry also affected the amount of financial resources the industry contributed to the GNP. The hospitality industry human resources practices before and after the terror attacks were different. Employers had no reason and opportunity to continuously investigate backgrounds of their employees. However, this changed after the 9/11 attacks. The hospitality industry suffered enormous losses after the attacks. The sector’s profitability was greatly affected that the industry came to a slump (Sturman, M.2002). The travel industry witnessed drastic decline in the number of people willing to travel, especially by air. The consumer confidence was also shaken. The managers and workers in the US hospitality industry acquired another responsibility which is to comfort and serve panicky and frightened customers. For instance, airline companies had to reassure their customers about their safety if they were to travel by air. The managers and employees in the industry experienced trauma and shock with some losing their jobs due to the negative effects of the attacks on restaurants, hotels and airline companies (Dolfman & Solidelle, 2004).
The industry was forced to manage the changes that came with the change of travel practices. There was drastic decline in revenue and occupancy rates plummeted. Business patterns in the industry changed to accommodate changes that were being made to address the crisis. New security regulations were put into place to tighten security in the industry (Barth & Lee, 2002). For instance, the passage of the USA Patriot Act allowed employers to investigate the employees. Furthermore, the Act gave the US government great authority to investigate any potential terrorist threat in the hospitality industry even in the absence of a court order. Though this was seen as an effective way of promoting security in the industry, there were allegations that the US government and many employers used it to invade the privacy of the employees. Crisis management and the most important factors in the hospitality industry
The 9/11 terror attacks resulted to a crisis. In order to manage such a crisis, there is need for an individual to have techniques and skills that will ensure that he or she can assess, properly understand, and cope with the crisis (Barton, 2007). Different opinions have been given about managing a crisis. Crisis management should involve eliminating technological failure and developing a formal communication system that helps avoid or manage a crisis when it comes up. According to another opinion, crisis management comprises of different methods of responding to the perception and reality of a crisis. For instance, developing and implementing a crisis management plan is one way through which people can effective deal with an emerging crisis. Another important aspect of crisis management is that it should involve the establishment of metrics that focus on defining the kind of scenarios that may constitute a crisis. This becomes very vital in triggering the necessary mechanisms of responding to a crisis.
Activities that are undertaken in pro-active crisis management include planning on how one should deal with the crisis if it were to arise. In addition, forecasting the potential crisis helps one to be well prepared if the crisis should occur in the future. When dealing with a crisis, it is important that the real nature of the crisis is identified so that intervention methods are developed to minimize the damage caused by the crisis. The intervention methods developed should also assist people in recovering from the crisis but most importantly, crisis management in the hospitality industry should focus on public relations so that the public image or damage is recovered. Crisis management needs to reassure the stakeholders that the recovery of the hospitality industry is underway.
In the hospitality industry, certain factors are very important and one of the most important factors here is security. This is important as customers need to feel safe. Insecurity puts away potential customers from seeking services from a hospitality institution or organization. Since customers only pay for services they are convinced will guarantee their security and that of their families and friends, security becomes an important factor for them. Yet another important factor in the industry is the quality of services that are offered to the customers. The hospitality industry has an obligation to provide customers with high quality services. Hotels, restaurants and travel agencies can only enjoy great benefits if the customers appreciate the quality of services offered to them. This promotes customer loyalty, which is very important for the growth of the industry because it leads to increased revenue. Additionally, the diversity of services offered by major players in the industry is also a critical factor. The greater the diversity of services that the hospitality industry or institutions, such as hotels, lodging, restaurants, and travel agencies offer, the greater is the probability of getting a large number of customers. Diversity is important because diverse services offered are able to cater to the different needs of the customers. Introducing a broad range of services assists the industry’s major players to effectively provide the changing needs of the consumers. While quality and diversity of services are important, the cost of services is likewise an important factor since different customers have varying economic abilities. Individuals tend to seek services that they can afford and services wherein they can get value for their money. Services that do not meet the value of the customers’ money or are too expensive may fail to attract a high number of customers seeking hospitality services in hotels, restaurants, and travel agencies.
How the US hospitability industry reacted to the 9/11 attacks and the process of post disaster recovery
The US hospitality industry reacted to the terror attacks by advocating for strict security regulations in restaurants, hotels, travel industry, and other areas related to the industry. All sectors in the industry were required to conduct thorough check ups such as background checks for all individuals working in the industry or those seeking services in the industry’s various sectors. This was meant to ensure that any weapon or equipment handled by individuals would not become a threat to security. In order to regain the trust of the clients in the security of the industry, the staff members in airports, hotels, and restaurants were called upon to comfort and serve the customers after the terror attacks. This was done to let the customers feel that they are still safe when seeking services from the sector. Apart from the customers, hospitality institutions such as restaurants, hotels, and traveling agencies encouraged their workers to stay calm and to observe security rules and regulations when handling the customers. The workers were also trained to adjust to the new regulations that were being introduced in the industry to provide maximum security for everyone (Barton, 2007).
The travel Industry Association of America through its chief Executive Officer William W. Norman made attempts to address the effects of the terror attacks to improve the economic situation of the industry. Since the attacks eroded the revenue and profitability of the hospitality industry, the hospitality stakeholders initiated efforts to rejuvenate the industry by informing the US Congress about the financial situation in the industry and what needs to be done to improve the situation. The Travel Industry Association of America recommended that the US government support efforts that would prevent consumer confidence in the US economy from being shaken. As a result of these efforts, the US Congress worked to assist the industry by passing several packages that would help the hospitality industry recover from the crisis. This in turn made urged local and state municipalities to initiate marketing campaigns through which they could encourage international travel and domestic tourism in the US. After the September 11 attacks, some of the states that greatly suffered from decreased tourism included Hawaii, New York, Florida, Nevada, and California.
Hotels in New York, Central, Southwest and New Jersey made modest improvements to the hotels’ procedures and staffing. The changes were meant to improve security in the hotels and areas surrounding them. It is a better way of warding off security threats, as well as ensuring that the security of the customers is guaranteed. All hotels in the US now make it to a point to ensure that safety and security procedures were strictly observed. Hotel managers confirmed that the hotels have ready plans for evacuating customers in case of an emergency. Furthermore, the institutions embraced a protocol whereby verification of the identity of guests at the check-in must be done. Security practices that would secure the access to the hotels interior hallways, to the elevators and other areas of the hotels were put into place. Hospitality industry sectors such as travel industry, hotels, restaurants and lodgings hired more security personnel. Though some hospitality sectors such as hotels had safety and security procedures that were in good shape before the attacks, some US hotels made some changes to the security procedures. For instance, some extended- stay and luxury hotels in the U.S updated their security policies and added the security staff.
The process of post disaster recovery for the hospitality industry in the U.S involved the strengthening of screening devices that were used by the industry’s employees. These devices were usually used to operate facilities where the public was likely to gather. The hospitality industry employers were after the attacks expected to verify the accuracy of information that was given by the guests. In addition, the employers were expected to ensure that the references that were offered were valid. Since the attacks occurred, screening techniques have been advocated for in the industry so that people with criminal history can be identified. Many US businesses within the industry are now monitoring their employees electronically. This is done through the reviewing of voicemails, monitoring phone calls, e-mails, video surveillance and computer files. Other methods that have been used by companies include the bag, locker and desk searches.
What has been recommended for major players in the industry to prepare an effective and comprehensive recovery plan?
Various recommendations have been given to assist major players in the US hospitality industry to develop an effective plan to recover from the effects of the September attacks. All the major players in the industry have been encouraged to embrace hospitality operations that ensure the safety and the well-being of employees and guests are protected (Hacker, 2006). This is vital in ensuring the customers’ security in the future. All hotels, restaurants, airlines, travel agencies and lodgings have been advised to ensure that daily operations are pervasive. This can be done by making sure that the employee selection processes are scrutinized and tightened to prevent the hospitality industry institutions from hiring employees who may become or pose a threat to the guests, other employees or the general public. Employee monitoring has been supported as a way of improving security procedures in future. One of the ways through which the major players have been urged to improve the general publics’ security as a way of attracting visitors in the US is by strengthening the screening devices those employers in the industry use or operate (Hacker, 2006). These devices are often used in areas where the general public gathers; hence public security will be protected. Since security is a basic need, increased security will attract more customers.
Recommendations have been made for the major players in the industry to establish work conduct guidelines where zero tolerance policies to violence are adopted, sexual harassment prevented and weapons completely banned from the premises. In efforts to increase the productivity of the employees so as to maximize the financial returns of the industry, major players are expected to check up on the employees’ quality of work or performance. A monitoring program that evaluates the performance of the employees has been advocated for in order to assist the industry recover from declined financial returns. The September 11 attacks have demanded that major players improve all areas that may be used by criminals to harm guests and the general public in the US. For instance, the threat of widespread contamination in the food delivery system in hotels, restaurants and lodgings seems real and potentially severe. Efforts to prevent such an occurrence as a measure to develop a recovery plan from the attacks have been made. This has demanded that the integrity of the delivery process is maintained until food is delivered securely to the hospitality institutions.
To improve the profitability of the hospitality industry, all major players have been encouraged to hire professionals who can assist the industry in improving all areas that can increase its profitability. Professionals increase the efficiency and performance of work, and therefore will ensure that high quality services are offered to the customers. The consumer confidence will be stabilized (Dolfman & Solidelle, 2004). The US government has been encouraged to offer financial support to the hospitality industry major players as a way of providing them with financial assistance they require to recover. The local and state municipalities have also been encouraged to initiate marketing campaigns that will attract international and domestic tourists in the US. Forecasts on arrivals of visitors to the US for 2002 and beyond have being revised by the Travel Industry Association of America, International Trade Administration and the Department of Commerce. This is very important in identifying the trends in the industry. Whether downward or upward, the major players can plan better based on the expected trends. The airline industry for instance, can draft plans on how to increase consumer confidence based on the trends so that the customers can confidently travel by air.
Summary of the Literature Review
The September 11 terror attacks had very devastating effects on the US economy. The hospitality industry was also greatly affected. The profitability of the industry declined drastically as the number of international and domestic tourists declined. The major players in the industry after the attacks were concerned about the future of the industry. In efforts to rejuvenate the industry, hotels, restaurants, travel agencies, and airline companies have been involved in plans that aim at ensuring that the industry recovers from the negative effects of the attacks. Recommendations have been given as the US government and the major players in the industry try to recover from the tragedy. This study will assess how different factors have affected the hospitality industry and how the hospitality industry overcame different challenges. It will also analyze what factors helped the industry to recover from such a crisis. The findings will be important as it can help the hospitality industry to recover from the occurrence of a crisis of the same magnitude in the future.
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