THE IMPACT OF COVID-19 ON HOTEL INDUSTRY IN MALAYSIA

Abstract

This study presents an empirical assessment of the nexus between COVID-19 and the performance of the Malaysian hotel industry. It must be noted that during the pandemic which began in early 2019 in Wuhan, China, there was a dearth of research with regard to hotels within Kuala Lumpur. This necessitates the current study to examine the impact of the pandemic on employee attrition, employee absenteeism, room cancellation, financial stability and business continuity. This research employed questionnaires to obtain responses to the salient questions under investigation using quantitative/objective approaches. The questionnaires were delivered to 575 respondents who are/were under the employment of 3-5 stars hotels in Kuala Lumpur. Partial least squares regression is adopted to examine the impact of COVID-19 in time-series and cross-sectional data. The study found a strong connection between the dependent and the independent variables. The result indicates that COVID-19 affected the tourism industry's performance negatively. COVID-19 has an impact on employee attrition, absenteeism, room cancellation and financial stability. Hotels are found to be unprepared for the emergence of COVID-19, and employees are involuntarily resigning from the companies. This study contributes to the novel dimension of COVID-19 on the Malaysian tourism sector. It highlights the negative impact of COVID-19 on hotel industry, specifically on employee attrition, absenteeism, room cancellation, financial stability and business continuity. Most hotels do not have a proper business continuity plan to overcome unexpected events.