The average income from service charges among hotels in Phuket is expected to stabilise, but would still maintain a high level in the upcoming high season, while the average room rate would continue to soar, according to the Phuket Hotels Association.
Bjorn Courage, the association's president, said the hospitality workforce has now fully returned following the pandemic, based on employment in 95 hotels in Phuket that are members of the association.
Typically, hotel service charges accounted for 10% of paid room nights, and the amount would be evenly distributed to all staff monthly, he said.
As more workers have been employed post-pandemic to cater to strong tourism demand, each member of staff is paid in line with a lower service charge compared to last year's high season, when some hotels recorded a historically high monthly service charge, said Mr Courage.
He added that the occupancy rate would remain at a high level similar to the 70-80% rate recorded in 2023.
Room rates are forecast to keep rising, mainly driven by strong demand and partly attributed to inflation and increasing operating expenses such as utilities and payroll.
However, Mr Courage said income from service charges in Phuket would still be stronger than in destinations with a slower rate of recovery, such as Hua Hin or Chiang Mai, but it may be lower than the rates recorded in hotels in Bangkok and Samui.
Compared to Phuket, Bangkok has a stronger mix of business guests, while luxury properties in Samui help raise the service charge rate.
Mr Courage said hotels are still exercising caution in terms of hiring staff. The number of employees might be lower, but they would be encouraged to increase productivity.
Most hotels have also opted to make agreements with schools for them to send student trainees to them.
According to STR, Phuket hotels have secured 30% more business on the books (BOB) year-on-year over the next six months.
Mr Courage said the country's visa-free scheme has been attracting foreign tourists, particularly Chinese and Indian nationals, while the longer eligible stay in the country has benefited Europeans and Russians, too.
He said Phuket's tourism market is more diverse, and is not only reliant on Chinese and Russian nationals in the way it was prior to the pandemic.
Last week, Saudia, Saudi Arabia's flag carrier, announced the launch of direct flights from Riyadh and Jeddah to Phuket, starting from December.
This week, the Phuket Hotels Association, C9 Hotelworks, Greenview and partner organisations held the Phuket Hotels for Islands Sustaining Tourism 2024 -- an annual event that brings together hoteliers and stakeholders across Asia to discuss sustainability.
They also plan to draft a white paper regarding sustainability and development to propose to the government in the next few months.