Are Service Industries at Breaking Point?

Has anyone else noticed what its like to work in an industry that is service based at present? If only everyone could make widgets. I have been observing service based industries over the past couple of years as we have moved through, and out the other side, of the pandemic, and to be frank, I’m not sure our population has been kind to service based industries. It can be observed everywhere, people behaving badly – hospitality, retail, emergency services, the professions, and for many it is pushing those people to the brink.

There is a combination of factors being influential here. One is a shortage of staff. We are hearing and seeing this across all industries. I recall having lunch at a pub for a birthday back in late 2021 just as Sydney really started to reopen after a couple of months of lockdown. It was extremely noticeable that many of the staff were new to hospitality work and had little understanding or skills. I recall one poor young man, he brought over a glass of wine and a beer to our table, and unfortunately in the process managed to spill the drinks all over the couple who had placed the order. A little bit later the same guy was carrying a tray of empty champagne glasses and managed to drop the lot, and there was more carnage to come. The fellow was so embarrassed.

This highlighted another factor; being able to source experienced and skilled staff. This was very evident at this pub. Looking around, about half the staff were clearly new and lacked experience. So, many businesses, should they be able to find staff, now need to put the time into training and development these personnel to build skills, culture, and service excellence.

Then we have another type of employee who doesn’t want to work and really doesn’t place any pride in their work. The good enough is close enough mentality. I have a couple of sub contractors working on my building at home with that approach and it’s driving me nuts!

One business broking colleague commented to me that the pandemic has bought out the best in some people, but also bought out the worst in others. I have noticed how some people’s expectations in terms of just about anything have risen, to what I would describe in some circumstances as unreasonable. People almost seem to have become ruder, less tolerant, more demanding, more impatient, and it is impacting upon those to who they express these behaviours, those at the frontline.

I have seen it firsthand. I have friends who operate restaurants who have had enough and want to sell. I know long term paramedics and nurses who have been kicked from pillar to post and have rightly had enough. These guys and girls have had it very tough over the past couple of years, not only trying to perform their jobs, but also training their newbie colleagues at the same time.

I know it has also impacted the professions. The past couple of years has seen the biggest reduction in licensed financial planners, albeit not so much related to the pandemic, and this will put the pressure on moving forward. Within the accounting profession, we have seen an increasing number of practitioners, of varying ages, say enough is enough and sell up. The three leading causes for why principals are leaving the profession are:

• The increased expectations of clients in terms of servicing combined with an unwillingness to either pay for the increased level of service at all or pay a fair price for the service
• The increased demands of the ATO in terms of the compliance, education, and information pieces that firms should be providing to their clients
• Lastly, the inability to source suitable staff

Don’t get me wrong, many still love servicing their good clients. They continue to enjoy helping and guiding those clients who appreciate the service, however they are completely over all the other ‘stuff’. Let’s put it all in a bucket called ‘ADMIN’. If they could get rid of that, have someone else handle that, it would be all good!

As I look around, I am concerned. Who will we have left working in our service industries if they feel abused, belittled, unappreciated? Thus, as a population we perhaps need to try and be kinder to each other. Perhaps if you see someone having a hard time, given them a little smile or say thank you. It can go along way!