KUCHING: Sarawak hotel owners and operators hope Budget 2027 will offer targeted support and incentives to address current challenges, particularly the continued rise in operating costs.
Malaysian Association of Hotels Sarawak chapter chairman John Teo urged the government to prioritise the industry's problems in the current operating environment.
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"The cost of operation is the one issue I would most like the government to prioritise," Teo said of the industry’s wish ahead of the Budget, to be tabled on Oct 9.
Teo said the introduction of minimum wage has increased operating costs.
"The hotel industry highly depends on human resources," he said on Sunday (Sept 27).
"From housekeeping and food and beverage services to kitchen operations and front-line guest services, every aspect of hotel operations requires sufficient manpower to maintain daily operations and service quality.
"In recent years, hotel operators have been facing increasing cost pressures, particularly in areas such as wages, electricity, food supplies, maintenance and other operating expenses."
However, Teo said higher operating costs do not necessarily mean that hotels can simply increase room rates accordingly.
He said the industry is also facing intense market competition, especially from unlicensed AirBnB rentals and other accommodation providers in residential areas.
"As a result, it is difficult for hotel operators to fully pass on additional costs to consumers.
"In the long run, this pressures profit margins and the sustainability of hotel operations," he said.
Teo said targeted support measures could include assistance to reduce operating costs, encourage digitalisation and automation, improve employee productivity and strengthen the manpower supply.
"I believe that addressing both the cost and manpower challenges will enable hotels to maintain service quality while remaining competitive, and at the same time continue contributing to the growth of the tourism industry and the wider economy," he added.
He therefore hoped Budget 2027 will provide more targeted employment and wage support for the industry, particularly for small and medium-sized hotels, greater training subsidies to reduce the cost of training new employees, and incentives for businesses to upskill employees and provide better career and wage progression.
He also said the industry should receive more support for hiring local workers and developing talent for management positions.
"We hope that while the government continues to promote higher wages, it can also help businesses improve productivity so that both employees and hotel operators can benefit," he said.
