10 Minutes with Michael Jacobson

January 28, 2020

Ten Minutes with IHLA’s Michael Jacobson

From the American Cancer Society to the U.S. Travel Association, Michael Jacobson has built a successful career on advocacy. Now, eighteen months into his role as President and CEO of the Illinois Hotel and Lodging Association, he recently spent a few minutes with the team at TraknProtect and gave voice to the concerns of Illinois hoteliers as they face what may be a particularly pivotal year for the industry.  

Below are some excerpts from our conversation.

TnP: What led to your interest in the hospitality industry?

MJ: It happened quite early actually – both through studying abroad and also through interning for a semester in Washington DC. One of the firm’s clients was InterContinental Hotels and it was eye-opening to me, seeing how many government issues impact the hotel industry. That experience also introduced me to the AHLA, and the U.S. Travel Association, an organization that I would eventually work for when I went back to DC.

TnP: When you think about the different forces influencing Illinois hotels, perhaps particularly in Chicago, what do you think are the main issues keeping your association members awake at night?  

MJ: I don’t think many people outside of the industry appreciate how expensive it is to operate a hotel. When you combine property tax, energy, and labor costs, there are so many different financial pressures at play that, when you look at some of our average nightly rates, it’s becoming hard if not impossible for many of our hotels to turn a profit. There are hotels here paying more than $25,000 per day just in property taxes and that’s insane to think about before labor, energy, maintenance or any renovation costs. One of our hotels in the city of Chicago was foreclosed on last year, and unfortunately, that might be a trend as our costs are going up and our rates aren’t. The equation just isn’t matching up right now.

TnP: Can you describe your typical day at the IHLA?

MJ: Well that’s the fun and the frustration of the job because there is no typical day! Fortunately, we’re a very nimble organization because we get pulled in many directions, but that’s no different than the life of a hotel General Manager. We talk a lot about policy and government issues and our core mission is advocating for the industry while trying to lessen some of the government intervention where it has been restrictive to us. But there’s an equally important role in employee recruitment and training. We’re helping people understand how special the hospitality industry is, how rewarding a career path it can offer, and breaking that mentality that these are dead-end, low wage jobs. We want to give our people the tools to do their jobs well, and hopefully to grow within the industry and be successful.

TnP: What’s on your agenda right now?

With the new Illinois Legislative Session having just started on January 28th, we are continuing to educate our members on the new laws already passed that come into effect this year. Employee safety devices are required by July 1st and it’s surprising, and disappointing to me that so many hotels are unaware of the law, despite multiple communications from us. That said, making sure they’re compliant by the deadline is an important priority. We’re also focused on Human Trafficking Awareness Month, and we’re having a big event at the end of the month with an in-person training for our employees around human trafficking issues. We have the NBA All-Star Game coming to Chicago and it’s a sad reality that the host city of any large sporting event like this usually sees an uptick in human trafficking cases. All of the branded hotels already have online training, but for such a large scale, high visibility event, we’ll be doing an in-person refresher for hotel employees in the city. It’s a passion of mine and an industry commitment that we need to address head-on. No hotelier wants human trafficking happening in their hotel so we’re going to be doing everything we can to prevent it.

TnP: You were very instrumental in providing educational events and webinars last year concerning the new legislation around employee safety devices. What do you see are some of the problems for hotels in adopting some of those measures?

MJ: Much of it is just a lack of awareness, especially if you‘re not a member of IHLA – so here we took a different approach because, even if the hotel wasn’t a member, we really can’t afford for any employee to be unprotected.  With that in mind, we’ve been sending communications to every hotel in the state, regardless of membership status. Trust me, no hotel wants to put their employees in danger, but many just simply aren’t aware of the issue.

TnP: Given the pressures you’ve mentioned around hotel operational expenses, has cost become an additional barrier to the adoption of employee safety devices?

KS: Of course, the expense is always a concern. The fact is, between minimum wage going up twice this year, new human trafficking training requirements, etc., there are a lot of hard costs to absorb all at one time, particularly when you’re barely making a profit — but no, I don’t think cost is a legitimate reason not to do it.

TnP: Much of your role must involve some intense interaction with Springfield. How receptive do you find Illinois lawmakers are to the challenges being faced in hospitality?

MJ: It all depends on their pollical leanings and also what part of the state they’re representing. Certainly, some of the impact of the issues we’re facing has, in many cases, fallen on deaf ears. Many lawmakers take the hotel industry for granted and there’s a general lack of understanding of how truly important the hotel and tourism industry is to local jobs and to the local economy.

TnP:  Where do you see the opportunity for the Illinois hotel community?

MJ: Our positioning as a convention and tourist destination is always going to be an opportunity but it’s a competitive market. A lot of other cities are investing in their convention centers that we frankly haven’t seen in Chicago; Las Vegas is building a new convention center, Miami has a new convention centers, San Francisco has just finished renovations to theirs and those are all cities we compete with, so it’s a challenging market. We’re continuing to grow tourism even though it’s becoming harder than ever. We’re the only airport in North America connected to every continent in the world, and yet so many travelers land at O’Hare and then immediately connect elsewhere. There is a huge opportunity in getting them to stay and experience not just the city but to travel throughout the state – Route 66, some of the state parks – we all know those offer some great experiences, particularly with international visitors who stay longer and spend more.

TnP: What do you see as the role the Association’s affiliate members, like TraknProtect, in helping the hotel community achieve their goals?

MJ: The support of partners like TraknProtect has been really instrumental in helping educate our members and get them up to speed on new legislation. We have partners in other sectors who have helped show hotels how to conserve energy, saving our members thousands of dollars in water and electricity efficiency and helping the environment. That’s the exact reason why it’s important to have partners, to help hotels become more profitable and efficient while, in return, being able to generate new leads and business opportunities for these vendors.

TnP: What has been your most memorable hospitality experience?

MJ: I recently returned from a trip to Paris and enjoyed probably one of the best hotel employee interactions I’ve ever experienced. A hotel employee, originally from Argentina and now at the Hyatt Regency in Paris, had to have been one of the most caring people we’ve ever met. That, I think, is the very essence of hospitality, because not many industries are that multinational or provide the same opportunities for travel. Also, while there are a lot of conversations around short term rentals like Airbnb and others, you don’t get to experience the personal interaction with hotel staff who share and can enjoy the experience as much as you do.

TnP: What would you be doing if you weren’t doing this?

MJ: In the past, I’ve worked with children with special needs, and so perhaps teaching, working in special education will always have a special place in my heart.

TnP: Can you describe your best day at the IHLA?

MJ: It’s not just one day, it’s multiple instances because my favorite events of the year are our Stars of the Industry celebrations. We do two regional events, and a state final all in the fall, and it just makes you realize who you’re working on behalf of. These are front-line employees of our industry and you understand how important that kind of recognition can be to them. We have 292,000 hotel employees in the state and the fact that all of them go in to work every day – and you don’t survive if you don’t work hard and you’re not hospitable – and when you get to celebrate that, I always go home from these events with the reaffirmation that we’re doing the right thing here.