After consultation with leaders of the 40,000-member Hotel and Gaming Trades Council, Hochul steered a big chunk of her $450 million tourism revival program for New York into ramping up employment at the city’s 300 hotels — which employed some 50,000 workers pre-pandemic.
The plan includes a $100 million Tourism Worker Recovery Fund, which includes a one-time payment:of $2,750 to up to 36,000 hotel workers and other tourism industry workers who were eligible for expired unemployment benefits.
Another $100 million aims to spur hotels and other tourism-reliant businesses that suffered job and revenue losses to rehire workers by offering $5,000 grants to subsidize each full-time worker added to the payroll and $2,5000 for part-time workers.
To receive the full benefit, employers will have to maintain employment increases over 6 months.
Hotel industry sources said it was good policy — and politics — for Hochul to prop up the hard-hit hotel industry, reeling from travel shutdowns and restrictions during the pandemic. Hochul is running for re-election next year and faces what is expected to be a tough Democratic primary challenge from state Attorney General Letitia James.
Hochul is using a combination of COVID-19 federal American Rescue Plan funds as well as state funds to pay for the plan.
One hotel union insider said Hochul’s support for the industry will not be forgotten.
“Gov. Hochul has earned an enormous amount of goodwill and support from our union members and leadership. No question,” the hotel union source said.
Said Hotel Trades and Gaming Trades Council president Rich Maroko, “The loss of federal benefits was devastating for thousands of hotel workers. But by working with Gov. Hochul on this strategic grant program to incentivize rehiring of those who are still out of work, we’re able to fight back against the unemployment crisis our members face. The extra income these workers will be receiving will be critical in keeping them afloat while the tourism industry recovers and rebuilds post COVID.”
Vijay Dandapani, president of the Hotel Association of NYC said, “We think it is an excellent move on the part of the Governor to help a beleaguered industry that has been severely impacted by COVID, the impact of which has been felt by all elements of the hotel industry: employees (both management and labor) and employers (owners and operators).”
He said Hochul’s plan was more constructive than the city “severance law” requiring hotels with 100 or more employees to provide workers with severance payments of $500 per week for 30 weeks.
In addition, the Hochul plan includes a $25 Million “Meet in New York” grant program that convention planners partnering with hotels can tap into to offer discounts on booking fees or room blocks to woo back business-related tourism.
Hotel industry sources said the help cannot come soon enough.
Last year, international visitation statewide plummeted 86 percent from 2019 and domestic visitation cratered by almost 40 percent The loss of business resulted in a nearly 55 percent loss in direct spending and an almost percent drop in economic impact, according to government and industry reports.
A report by state Comptroller Tom DiNapoli found that the drop in tourism activity accounted for 59 percent of the city’s $2 billion decline in tax collections.
Hotel and tourism workers suffered the worst job losses of any industry in New York, according to the state Labor Department. The number of tourism industry jobs dropped by 62 percent — from 52,400 to 32,700 between September 2019 and July 2021.