Hilton Worldwide is cutting its global corporate staff by 22 percent, representing 2,100 people, and extending for another three months the furloughs, reduced hours and pay cuts that were announced in late March, the company announced on Tuesday.
The moves are a result of the devastating effects of Covid-19 on the hospitality industry, according to Hilton, and follow related announcements made by Marriott International and Hyatt Hotels Corp. in recent weeks.
"Never in Hilton's 101-year history has our industry faced a global crisis that brings travel to a virtual standstill," said Hilton president and CEO Christopher Nassetta in a statement. "Hospitality will always be a business of people serving people, which is why I am devastated that to protect our business, we have been forced to take actions that directly impact our team members."
As announced in March, Nassetta will forego 100 percent of his salary for the remainder of the year, executive committee members' salaries have been reduced by 50 percent, and non-furloughed staff salaries have been reduced up to 20 percent. No additional salary cuts were made with this new announcement, according to a company spokesperson.
The hotel industry has been particularly hard-hit by the coronavirus pandemic, with the weekly U.S. occupancy level dropping as low as 21.6 percent in April, though it has begun to recover and was at 39.3 percent for the week ending June 6, according to STR. Still, that is far from its 66.1 percent level of full-year 2019.
Thousands of hotels around the globe also have closed during the pandemic. As of June 16, STR's database showed a total 1,891 temporary hotel closures in the United States, totaling 476,267 rooms and down from 3,141 hotel closures as of May 14. At its peak, Hilton had about 950 hotels with suspended operations globally; today the number is roughly half that, according to a company spokesperson.
RELATED: Hilton to Furlough Employees, Reduce Salaries