Despite facing cost pressures, hotels safeguarded their margins by reducing hours per occupied room and boosting productivity in key departments
ATLANTA, Dec. 12, 2025 — Today, the 2025 Hotel Labor Costs & Trends report was issued on by Actabl, disclosing how U.S. hotels have streamlined labor models throughout the year to counteract increasing wages, elevated operating costs, and revenue performance that regularly missed expectations.
The report indicates that although wages increased by as much as 5.9%, labor cost per occupied room climbed between 2% and 11.2%, and staffing levels expanded between 4% and 9%, operators preserved margins by trimming hours per occupied room and achieving significant improvements in labor efficiency. Between January and September, hours per occupied room fell by 7-15% in guest services, housekeeping, and management, while productivity rose for most frontline and leadership positions.
These efficiency improvements occurred while revenue results trailed projections. Hotels had established ambitious targets for 2025, projecting room revenue budgets to increase 14.1% year-over-year during the first nine months, even though they expected ADR to drop between 1.9% and 2.4%
These findings illustrate how hotels sustain profitability through better labor productivity, refined forecasting, and demand-based staffing optimization. The 2025 Hotel Labor Costs & Trends report is based on aggregated data from thousands of U.S. hotels using operational and financial platforms.
“Labor shaped hotel performance more than any other expense category in 2025,” stated Sarah McCay Tams, head of research at Actabl. “Operators began the year anticipating robust revenue, but weaker revenue results and escalating labor expenses demanded greater discipline. Notably, hotels enhanced productivity without reducing staff, leveraging forecasting, cross-training, and precise scheduling to defend margins in a difficult climate. Labor efficiency has become as critical as pricing strategy. In 2026, the top-performing hotels will be those that align labor directly with demand and mobilize staff dynamically.”
Key Findings
- Hours per occupied room declined across all major departments
- From January to September:
- Guest Services HPOR fell 13.5%
- Housekeeping HPOR fell 7.1%
- Management HPOR fell 14.6%
- Hotels reduced hours while maintaining service quality, indicating improved demand alignment, cross-training, and enhanced staffing plans introduced mid-year.
- From January to September:
- Position-level productivity also advanced
- Minutes per occupied room (MPOR) improved during 2025 across frontline and leadership positions:
- Room attendants: 5.5% faster
- Guest service representatives: 12.7% faster
- AGMs + GMs: ~14% faster
- Overall, MPOR declined 9% across assessed roles.
- Minutes per occupied room (MPOR) improved during 2025 across frontline and leadership positions:
- Wages increased, but strategic deployment mitigated the impact
- Average wages grew 3.7% to 5.9% year-over-year, and cost per occupied room increased 2% to 11%. Operators minimized margin pressure by optimizing shift structures instead of cutting headcount.
- Headcount grew, showing stability rather than reductions
- Hotels expanded headcount 9% through summer and sustained staffing levels 4% above January, utilizing overtime as a managed buffer for demand instead of an uncontrolled cost.
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SOURCE Actabl