As Wine Country tourism halts, hotel workers see jobs vanish

The mountain of canceled bookings and postponed reservations that has rocked Sonoma County’s lodging industry amid the coronavirus shutdown has already led to hundreds of job losses in Healdsburg, one of Wine Country’s most reliable overnight destinations.

Most of the housekeepers, desk attendants and maintenance employees needed to support the city’s 640 hotel rooms have seen their work, if not their jobs, vanish after the county’s 21-day shelter-in-place order went into effect March 18.

The fallout from that unprecedented step has proved especially wide in Healdsburg, where as much as 70% of economic activity is based on tourism.

Tegan Wilson, 41, the principal concierge at Hotel Healdsburg, was among roughly 300 workers furloughed through at least the end of next month at her company’s three boutique Healdsburg properties.

Wilson, a longtime Healdsburg resident, has no plans to move from her apartment on the north end of town, but, as with many in a labor force living paycheck to paycheck, she is left to guess how long she can stay afloat if the shutdown is extended or if she’s ultimately laid off.

“I’m trying to be optimistic that this will not be the case due to more ‘staycations’ versus international travel once bans are lifted,” Wilson said. “But, yes, I am being much more conservative and thoughtful in all of my purchases.”

She’s one of the roughly 4,000 hotel workers across the county whose positions are now in some jeopardy, with the bulk of hoteliers closed or barely occupied. Many of the affected workers are filing unemployment claims, and awaiting word about the federal stimulus package that is poised to deliver billions of dollars in aid to the ailing lodging sector.

With approximately 23,000 workers in the county’s tourism sector, unemployment claims are expected to rise through next week, said Claudia Vecchio, president and CEO of Sonoma County Tourism. Up to 80% of that workforce could be affected in a worst-case scenario, she said.

“The impact of being shuttered is pretty complete. It’s catastrophic, there’s no question,” Vecchio said. “The length of this will certainly be critical to the survival of a lot of small businesses, but it’s an incredibly impactful event, for sure.”

About 7,150 rooms exist among Sonoma County’s 112 lodging properties, according to STR, a hospitality industry research firm. The sharp drop in reservations and rise in postponed or canceled bookings that started at the beginning of March was like nothing tourism industry veterans had ever seen, even in disaster-wracked Sonoma County.

“Leisure travel as we know it is dead,” said Aaron Krug, who operates the Best Western hotels in Healdsburg and the city of Sonoma. “Basically, there’s no occupancy and right now there’s no work. If there’s no work, we can’t pay people, so it’s a nature of this problem, unfortunately.”

Through last week, Sonoma County hotels saw occupancy rates down 53% compared to this same time last year, STR reported. For full-service hotels, which offer restaurants, meeting spaces and other amenities, the decline in business was even greater - down about 70% compared to last March.

But Krug and a handful of other holdouts are continuing to operate in the face of the nosedive in visitors, with a skeleton crew made up of mostly managers keeping the lights on. As occupancy plunged, room rates have dropped to lure bookings from visitors with essential business who are still allowed to travel.

Some of those hotels that have temporarily closed, including Hotel Petaluma, are considering reopening to house essential workers, such as first responders and medical workers. Some sites that serve travelers also could transition to host medical beds if area hospitals need to move patients.

At Healdsburg’s Hotel Trio, Brooke Ross is hoping to capture more business during the shutdown from health care workers, offering discounts of up to 70% at the 122-room hotel. The hotel also has some long-term guests who are booked through the end of the year.

But even for those few customers, amenities aren’t what they were earlier this month: the bar, dining area for breakfast and pool are all closed.

“We don’t have any plans of closing,” said Ross, the hotel’s director of sales and marketing. “We have a very small staff to bring with. We’ve cut hours and tried to be creative. We’ve given people the option to use (paid-time off) and things like that. So people are using that as of now, then we’re kind of taking it day by day, really.”

Some of the luckier ones, such as Wilson and the hundreds of full-time staff at the other two Healdsburg hotels owned by her company - H2 and the Harmon Guest House - are still receiving health care benefits while furloughed.

An employee relief fund and other support programs are also being established to help workers get through at least April, and ideally not a day longer - though Gov. Gavin Newsom suggested Tuesday that isolation orders in the state could last as long as 12 weeks.

Hopes of a quick recovery, including a return to work for the thousands of local hotel employees sent home, are pinned to the belief that Sonoma County - and its Wine Country darlings like Healdsburg and Sonoma - will remain a prime tourist destination after the coronavirus outbreak subsides.

In the short-term, that’s likely to mean reduced rates, and lower revenue the rest of the year. That will put strain on budgets, Krug said, which could result in layoffs down the road, depending on how fast the tourism economy rebounds.

“This whole thing’s just a nightmare. We want to get everybody back to work, first and foremost,” he said. “But we feel once this order is lifted and we kind of get back to semi-normal life, there will be a lot of pent-up demand here and in the greater Bay Area. As far as we’re concerned, everyone is furloughed, and as soon as business comes back, we plan on calling them back, as soon as things get back to normal.”

You can reach Staff Writer Kevin Fixler at 707-521-5336 or kevin.fixler@pressdemocrat.com. On Twitter @kfixler.