Hotel GMs: Here’s How I’d Tackle Labor Costs in 2027

Labor should be near the top of every hotel GM’s priority list heading into 2027.

In a survey from the American Hotel & Lodging Association conducted in March, 65% of hotel owners identified labor costs as a leading financial pressure, while more than half said their properties were still somewhat or severely understaffed. The industry paid nearly $128 billion in wages and benefits in 2025, with that figure projected to approach $131 billion in 2026.

Those numbers tell a pretty clear story: Hotel leaders are paying more for labor while still struggling to fill the schedule. At the same time, cutting staff across the board isn’t a strategy. It can lead to longer waits, lower guest satisfaction and burned-out team members.

If I were a hotel GM looking to tighten labor costs for 2027, here are five places I’d start.

1. Build Schedules Around Demand, Not Habit

Many hotels still build weekly schedules around past staffing patterns, even when occupancy, arrivals, departures and outlet demand change significantly from one day to the next.

I’d compare scheduled and actual hours against occupancy, rooms sold, check-ins, checkouts, group activity and outlet covers. Then look for the times when staffing levels regularly exceed the amount of work being generated – or when you’re consistently short-handed and paying overtime to catch up.

The goal isn’t just to cut hours. It’s to put the right hours in the right places. Better forecasting and access to current performance data allow department leaders to make small adjustments earlier instead of waiting until the payroll report reveals a problem.

2. Use Data to Staff More Precisely

Housekeeping and maintenance make up much of the labor expense at hotels, but the number of occupied rooms doesn’t tell you everything needed to build the day’s schedule.

Look at arrivals, departures, stayovers, room types, guest preferences and out-of-order rooms. A suite checkout isn’t the same amount of work as a standard-room stayover, and the assignments shouldn’t be treated as if they are.

Room-status data can also help teams work more efficiently throughout the day. If attendants know which rooms are vacant, which guests have requested service and which rooms need maintenance, they spend less time waiting, walking back and forth or chasing updates.

Track average cleaning time by room type, compare productivity across days and shifts, and look for problems in the process before assuming the answer is fewer people. Sometimes the biggest opportunity is better coordination, not a smaller housekeeping team.

3. Give Guests More Ways to Help Themselves

Self-service doesn’t have to make a hotel feel less hospitable. It can give guests more control while freeing employees to focus on the interactions where personal service really matters.

Mobile or kiosk-based check-in and checkout, digital keys, automated folio delivery and self-service payment can reduce the number of routine transactions handled at the front desk. Depending on the hotel, a self-checkout market or grab-and-go area can also make food, drinks and basic amenities available without keeping an outlet staffed all day.

Guests are increasingly comfortable with these options. According to a 2025 Mews survey, 70% of American travelers said they were likely to check into a hotel using an app or self-service kiosk instead of a traditional front desk.

I’d think about the hotel experience through the eyes of guests who have grown comfortable with the Airbnb model. They’re often happy to grab extra towels from a convenient location, meet a DoorDash driver in the lobby, or use their phone to get an immediate answer. That doesn’t take hospitality away. Done well, it gives every guest an all-knowing personal concierge while freeing the hotel team to focus on the moments when a human touch matters most.

4. Let AI Answer the Questions Your Team Hears Every Day

Hotel employees answer the same questions over and over: What time is breakfast? Where should I park? Is the pool open? Can I request a late checkout?

AI-powered guest messaging can handle many of those questions instantly through text, chat or messaging apps. It can also translate messages, create service requests and send tasks to the right department.

That can reduce calls to the front desk, housekeeping, maintenance and F&B outlets while giving employees one organized place to manage guest requests. It can also help hotels provide quick responses overnight or during busy periods without adding another person to every shift.

I wouldn’t turn every guest conversation over to AI. Complaints, emergencies and VIP requests still need a person. But there’s no reason employees should spend hours each week typing the same basic answers.

5. Eliminate Work the Guest Never Sees

Finally, I’d take a hard look at the administrative work happening behind the scenes.

How much time does the team spend downloading reports, copying numbers into spreadsheets, printing and scanning night-audit files, posting journal entries or matching transactions across different systems? Those tasks are necessary, but that doesn’t mean they all need to be done manually.

Automating night audit, financial reconciliation and journal posting can remove repetitive work from daily property routines. Centralizing hotel data can eliminate hours spent building reports, while scheduled reports and alerts bring the most important information directly to managers.

I’d ask my department leaders to identify the recurring tasks that take time without improving the guest experience. Then determine what can be eliminated, simplified, centralized or automated.

Reducing labor costs shouldn’t begin with staffing cuts. It should begin with empowering your on-property team to work smarter in the back office, giving employees more time to focus on the guest touchpoints that build satisfaction, inspire loyalty and ultimately drive more revenue.

For more ways to structure your day around labor optimization, download the Hotel General Manager: Daily Checklist.