Human capital: the forgotten variable in value

Start with one fact that shows what is at stake, and that should hold policymakers' attention. Salaried employment in accommodation (hotels, campsites and tourist residences) grew by more than 51,000 positions over ten years.^¹⁶⁵ Over the same period, the hotel stock lost about 11% of its hotels.^¹⁶⁶ Fewer hotels, more salaried jobs: the two trends coexist, although these two series, which do not cover the same scope, do not allow them to be linked. One plausible explanation is that new openings are larger and more upscale, and therefore more labor-intensive. The hotel, café and restaurant sector confirms the scale: about 1.3 million employees in 2025, 42% of them under thirty versus 24% across the private sector, a particularly young sector.^¹⁶⁷ But this national net job creation probably masks the same polarization as the hotel stock: jobs are likely created first where large urban hotels open, and lost where the rural hotel closes; the national series used here cannot confirm this. For policymakers, national and local alike, hotel human capital is therefore not a sector issue: it is a regional-development issue.

5.1 — From cost to asset: a necessary shift in perspective

Section 3 treated labor as a cost: the weight of employer social contributions, net wages well below the private-sector average (3.2.4), recruitment difficulties (acute through 2023, eased since, but rising again year on year), and high seasonality and turnover. This reading is accurate but incomplete. It frames labor as a cost to be compressed, whereas the thesis of this paper leads us to see it differently.

If the value premium is no longer captured through volume but through repositioning (moving an asset upmarket to a higher standard), then service quality becomes a valuation driver, not just an expense line. And service quality cannot be decreed: it rests on the skills and stability of teams. Human capital stops being a cost to minimize and becomes an asset to build.

This shift in perspective bears directly on the foundation-or-rent thesis. A hotel stock that underinvests in its human capital can keep collecting the destination's reputation premium, but it does not build the operating foundation that would justify that premium over time. The workforce is one of the silent conditions for turning the rent into a foundation.

5.2 — What turnover destroys

Staff turnover in hotels and restaurants is not merely a management inconvenience. It destroys value, and the extent of that destruction needs to be measured.

The first obstacle is the lack of recent data. The most frequently cited public series on sector turnover date from 2022, at the height of the wave of resignations; this paper reads them against their 2019 benchmark.^¹⁶⁸

What is established, and matters more than any single rate, lies in the employment model itself. More than one in two hiring plans in the sector are seasonal, versus fewer than one in three nationally (5.4): each one a contract set to end. Instability is not primarily imposed from outside; it is built into the structure. A model of this kind finds it harder to accumulate know-how, unless it retains its seasonal staff from one season to the next. And two mechanisms compound. First, the sector hires massively for the season. In 2025, accommodation and food services signed more than one in ten private-sector hires, while employing only about 6% of private-sector employees.^¹⁶⁹ These hires count contracts, not people: the same casual worker may sign several in a year. They show how often the sector has to recruit. Second, those on permanent contracts leave far more often than elsewhere. In 2019, before the wave of resignations that followed the pandemic, 28% of the sector's employees on permanent (CDI) contracts resigned, versus 9.6% across the economy. In 2022, at the height of the wave, the sector's rate was still nearly three times the economy-wide rate.^¹⁷⁰ The gap existed before the wave; it is not driven by it. The most recent filings confirm this: in 2025 as in 2019, the sector accounted for about one in six private-sector CDI resignations (17.2% and 16.7%), while employing only about 6% of private-sector employees.^¹⁷¹

The cost of this phenomenon is largely underestimated because it is partly invisible. Beyond the direct cost of recruiting and training a replacement, each departure entails lost productivity during the ramp-up period, disruption to the remaining team, and above all an erosion of tacit knowledge: familiarity with regular guests, procedures, fixes learned on the job. In the United States, across all industries, the Society for Human Resource Management (SHRM) puts this cost at between half and twice annual salary, depending on the level of the position; we did not find any published French measure for the hotel industry, and the order of magnitude is probably lower for frontline positions.^¹⁷²

This value destruction hits exactly where moving upmarket is won or lost. A hotel aiming for a higher standard sells an experience, and the experience lies in consistent service. A team in constant turnover can neither accumulate know-how, nor sustain guest relationships, nor deliver the consistency that distinguishes a repositioned hotel from one that has merely been renovated. The building can be refurbished; service is built over time.

5.3 — The main leakage is out of the sector, more than to another employer

Public debate too often reduces the skills issue to a labor shortage, and the response to a training effort. Official data show weak retention; from this we draw a different diagnosis: the primary problem is less about training more people than about retaining those already trained.

The law recognizes the problem. The ministerial order of May 21, 2025 added several hotel and restaurant occupations to the regional lists of shortage occupations: cooks and hotel staff (housekeeping, lobby and front desk) in all thirteen regions of metropolitan France. Café and restaurant servers are listed in only nine, notably excluding both Île-de-France and Provence-Alpes-Côte d'Azur.^¹⁷³ The legally recognized shortage is thus concentrated in the kitchen and in housekeeping: the jobs that directly underpin service quality and, through it, the move upmarket. Its geography, however, does not match that of hotel value: the country's two largest markets are partly exempt.

Behind this shortage, however, lies a more specific mechanism than a mere lack of candidates: a continuous outflow from the sector. DARES (the labor ministry's statistics directorate) measures it during the post-pandemic recovery, an extreme but revealing episode: of the roughly 375,000 employees who left accommodation and food services between July 2020 and July 2021, about 150,000 moved to another private sector and 225,000 left private salaried employment. More importantly, one-year retention remains low: only 66% of employees in the sector in July 2021 still worked there a year later, versus 68% before the pandemic.^¹⁷⁴ A substantial share of leavers therefore leave the sector altogether, rather than changing employer within it.

This shift in diagnosis changes the nature of the response. If the problem were only the volume of training, training more would suffice. But training more to feed a continuous outflow is like filling a leaking bucket. The useful questions become: why do people leave, and how can they be retained longer? The most frequently cited reasons for leaving relate to three levers: working conditions (irregular hours, unpredictable schedules, work-life balance, often cited as the leading reason for leaving), perceived net pay, and career prospects. None of these levers is a training issue; all three lie in the employment model itself. And they lead back to the cost-level disadvantage already established in Section 3: with one of the highest shares of non-wage labor costs in the EU (3.2.2), the French operator has less room to raise net wages above the minimum wage and staff up, that is, to pull precisely the retention levers. The extra cost is not the sole cause of the outflow, but it constrains the means to respond.

5.4 — Seasonality, housing, recruitment pressure: what has eased and what remains

Three constraints are regularly presented as specifically French. They deserve to be put in perspective: one has eased from its peak without disappearing, another is shared with our neighbors, and the third is genuinely structural.

Recruitment pressure has eased since its 2022 peak, but is rising again year on year. At the peak of the crisis, in the fourth quarter of 2022, 73.8% of accommodation and food services businesses reported recruitment difficulties (the series high), versus 61.7% for services as a whole; the figure was 42.7% in the third quarter of 2026, versus 27.9% a year earlier. According to the 2026 Besoins en main-d'œuvre (BMO) survey of employers' hiring intentions, 43.9% of the sector's hiring plans are expected to be difficult, versus 43.8% across all sectors.^¹⁷⁵ In this survey, hotels and restaurants no longer stand out in 2026 by the level of reported difficulty. They stand out by the trend: based on July 2026 responses, DARES notes that recruitment difficulties fell year on year in almost every sector, except other service activities and accommodation and food services.^¹⁷⁶ The shortfall itself persists and remains more pronounced than elsewhere: the sector's job vacancy rate was still 4.5% in 2025, versus 2.4% for industry, construction and services as a whole.^ʰ

What remains distinctive is the structure of employment. Seasonal jobs account for 54.5% of the sector's hiring plans, versus 32.2% nationally.^¹⁷⁷ The sector reports no more recruitment difficulty than others, but it struggles to retain staff, because more than one hiring plan in two is seasonal. Turnover follows mechanically: in July 2022, nearly four in ten of the sector's employees had not worked in it a year earlier (see note 170). It is this structure, as much as persistent recruitment pressure, that drives the indirect costs described in Section 3.

Housing for seasonal staff is the most tangible bottleneck, and it is not unique to France: every major Mediterranean tourism country struggles to house staff in areas where real estate is expensive. One clarification is essential, because it changes the nature of the problem: no statutory or collective-agreement obligation requires employers to house their seasonal staff. Housing is in principle the employee's responsibility; when the employer provides it, it is a benefit in kind subject to social contributions, valued at a flat rate or at rental value.^ⁱ It is therefore not an imposed cost but a trade-off. The mechanism is nonetheless self-reinforcing. The coastal and mountain towns where staffing demand peaks are precisely those where rental pressure (second homes, short-term rentals) puts affordable housing out of a seasonal worker's reach. Providing housing then becomes a de facto condition for hiring, and the trade-off plays out as follows: the hotel that can house staff hires and bears the cost; the one that cannot does not hire, and the constraint shows up not in its expenses but in its closed rooms. Land and labor meet here: the same land scarcity that constrains hotel supply pushes away the workforce needed to run it.

That leaves the burden of employer social contributions, which is real but already established in Section 3; it weighs on retention by widening the gap between employer cost and net wage, and there is no need to revisit it. What is more specifically French is the combination of these constraints with the small scale of the independent stock: where a large Mediterranean operator pools housing, recruitment and training, the French independent hotelier faces them alone.

5.5 — Training: the link that fragmentation weakens

Training is the lever through which human capital is built, and it is also the one that the structure of French hotel supply weakens most.

Several studies associate training, retention and service quality, particularly in the interpersonal skills that drive perceived value, without a causal effect having been established for French hotels: the best-managed and largest hotels train and retain more. Training, however, requires critical mass: teams large enough to free up time for training, a structured HR function, and internal career paths.

Yet the French independent core, mostly small, meets none of these conditions. The stand-alone independent hotel has neither the payroll, nor the support functions, nor the mobility prospects needed to retain and develop staff. This is one of the least visible but most real benefits of consolidation or brand affiliation: pooling the training function, offering career paths, professionalizing team management. The independent core, isolated here as elsewhere, once again bears the gap between what should be done and what its size allows.

One dimension is deliberately only sketched here: the future of hotel work. The sector's modernization (digitization of operations, changing guest expectations, reshaping of jobs between automatable tasks and high-touch interpersonal service) will require upskilling whose content and funding are not currently organized at the scale of the independent stock. This upskilling ties directly to the training-supply mismatch analyzed in 6.4. For the stand-alone operator, whose time for strategic thinking is the scarcest resource, the risk is one more lag on top of those described in this section. This workstream (how each job will need to evolve, and who will deliver the training) is beyond the scope of this paper and will be developed separately.

5.6 — What Section 5 establishes

Human capital is not an ancillary cost: it is a precondition for moving upmarket and, through it, for turning the destination rent into a durable operating foundation. High turnover destroys the know-how and consistency that give a repositioned hotel its value. The French disadvantage stems less from a lack of will than from an accumulation of structural constraints (employer social contributions, difficulty housing seasonal staff, small scale) that deprives the independent operator of the means to retain and train. And training, a decisive value lever, requires a critical mass that the independent core cannot reach alone.

Like the physical investment in Section 4, investment in people runs into the same limit: on its own, the independent hotelier cannot carry it. The question is not whether the human factor matters (it is at the heart of the hotel promise) but who, in the current structure of hotel supply, has the means to make it an asset rather than an imposed cost.