Hotel occupancy rates have tanked and the jobs are disappearing along with the guests as travel slams to a stop.
"It's very obvious that no one is traveling, and if they are they're just trying to get home," said Adam Kinsey, a partner in the Chattanooga Choo Choo hotel. "Occupancy rates have plummeted in the last 10 to 14 days."
The historic downtown hotel furloughed 30 people last week, leaving just a handful of folks to operate the property until this crisis clears.
"The hope is when we come out of this, we're able to hire everyone back," Kinsey said.
But the time frames are tough to predict. Hiren Desai, whose 3H Group operates 15 hotels, with four of those in Chattanooga, is talking through 90-day and six-month time frames with his lenders, he said.
In the meantime, he's had to let about 200 people go, 50 of them locally, and has managed so far to keep about 300 on the job across the company.
"At this point we're trying to keep a nuclear staff and pay them, keep them employed," Desai said. "I've taken my salary to zero for the rest of the year. We've been able to keep most of the staff of the corporate office intact."
Managing through this crisis is an hour-by-hour, day-by-day challenge, he added.
"We're making a movie without a script," Desai said. "No one has been in this position before."
Barry White, president and CEO of the Chattanooga Convention and Visitors Bureau, said his organization has shifted their focus almost entirely to providing resources and communication for local partners in the hospitality and related industries.
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The hotel industry supports nearly 2.3 million U.S. jobs directly and over 8.3 million jobs total. 44% of hotel employees in every state are projected to have lost or lose their jobs in coming weeks.ALABAMADirect jobs: 20,567Total jobs: 82,164Direct losses: (9,050)Total losses: (33,532)GEORGIADirect jobs: 55,000Total jobs: 255,767Direct losses: (24,200)Total losses: (104,381)TENNESSEEDirect jobs: 40,326Total jobs: 161,404Direct losses: (17,744)Total losses: (65,870)Source: American Hotel and Lodging Association
"The projections I've read on tourism economics estimate 45% of the losses we'll take as a national economy will be borne directly by the hospitality sector," White said. "This sector is going to be hit hard, is already being hit hard."
March and April are normally busy months for visitors to the Chattanooga area, with about 72% of Hamilton County's 10,028 hotel rooms booked in a typical March and 68% full in April. At the moment, occupancy rates at many hotels are hovering in the teens, including at the normally packed Moxy Chattanooga.
"I'm usually 90% sold out this time of year, and full on the weekends," said Dwayne Massengale, who has been the general manager of the 108-room Moxy since it opened in November 2018.
One of the handful of guests at the Moxy on Tuesday was Stephanie Morelli, who drove down from Delaware with her 4-year-old daughter, Ava, so they could spend time with her husband while he's in Chattanooga for his job repairing private jets. As a bartender, she has a lot of time on her hands these days, Morelli said.
"We usually don't travel with him, but I'm on unemployment now," she said.
Massengale and the hotel's head engineer spent Tuesday morning cleaning rooms and vacuuming the common areas, among other chores that usually fall to staff who have been let go.
"We're wearing many hats to keep as many people as we can," said Massengale who normally has a staff of more than 30 but is working with six now.
Some of Desai's extended stay properties are faring better than the Moxy for now, with occupancy rates in the 40% range, he said. But layoffs are unavoidable - and painful - when business dries up this dramatically, he said. The company has set up an emergency fund for employees and former employees who need help meeting basic needs, Desai said.
"We're trying to do the right thing," he said. "[It's] not pretty, but we're trying our best."
Connecting people to other sources of income, including at companies that are hiring as they ramp up to keep people supplied at home, is one of the ways the hotel industry is trying to help, Kinsey said.
"We're trying to give them as many resources as we can," he said. "I don't think anyone has real answers right now."
Contact Mary Fortune at mfortune@timesfreepress.com or 423-757-6653. Follow her on Twitter at @maryfortune.
Staff Photo by Robin Rudd / Kelly Helton, assistant general manager at the Moxy, cleans surfaces during downtime at the hotel. The hotel industry has lost guests and jobs amid the coronavirus crisis.