Reduction in Hotel Industry Turnover Occurred in May
The German hospitality industry has reported a decrease in turnover for May 2025, according to the latest data released by the Federal Statistical Office (Destatis). The preliminary results show a 4.6% decrease in real terms and a 2.2% decrease in nominal terms compared to April 2025.
This decrease is significant, considering the industry's turnover in May 2023 was higher compared to the same month in both 2022 and 2024. However, when compared to May 2023, the turnover in May 2025 showed a decrease of 7.8% in real terms.
The specific factors contributing to this decline are not directly detailed by Destatis, but several factors can be inferred from the broader context of workforce and economic conditions impacting the hospitality sector in Germany.
One of the key challenges faced by the industry is high staff turnover rates, with annual turnover rates ranging from 25-35%. The sector also faces significant challenges in retention due to limited career advancement opportunities, reliance on part-time, seasonal, or fixed-term contracts, and tough working conditions including unsocial hours and wage competition from other sectors.
Despite some employers investing in retention strategies such as upskilling, better compensation, and flexible schedules, smaller firms often struggle to match these improvements, potentially impacting operational capacity and service quality.
The sector is also highly affected by wage pressures, with a major upcoming minimum wage increase in 2026 that will substantially raise labor costs in hospitality, which employs a high share of workers below the new thresholds. This wage pressure likely leads firms to adjust operations, pricing, and staffing.
Broader economic indicators suggest mixed performance in manufacturing and logistics in May 2025, indicating general economic volatility which may depress demand for hospitality services or impact consumer spending patterns.
In summary, the decline in hospitality turnover in May 2025 can likely be attributed to persistent workforce challenges alongside increasing wage costs and economic uncertainty, impacting both supply (staffing and operations) and demand (consumer spending) within the sector in the short term. These factors collectively restrain turnover growth in real and nominal terms compared to April 2025. However, no explicit Destatis statement confirming these exact drivers was found in the search results.
[1] Source: German Hospitality Association (DEHOGA) [2] Source: McKinsey & Company [3] Source: ILO (International Labour Organization) [4] Source: German Chamber of Commerce and Industry (DIHK)
Businesses in the hospitality sector might be experiencing financial struggles due to high staff turnover rates, limited career advancement opportunities, tough working conditions, and wage pressures. The upcoming minimum wage increase in 2026 could further add to these financial challenges, particularly for smaller firms.
