Michigan tourism needs foreign workers. Visa woes make hiring them tough

Mark Ware is among the business leaders in Michigan who are renewing calls for federal officials to revamp a visa program for temporary workers after a federal budget proposal threatened to cut hospitality out of the program.

The CEO of Mission Point Resort has struggled to fill nearly 180 staff positions on Mackinac Island since the H-2B visa program changed over recent years. Visa awards were shifted to a national lottery system and returning workers became part of the annual awards instead of something an employer could count on.

This year, Mission Point was lucky in the lottery. The year before, competition squeezed it out and positions went unfilled. And across northern Michigan, hotels and restaurants that can’t fill positions with U.S.-based workers go through the same annual uncertainty over staffing.

Related:

• Michigan restaurants ask: How can we find enough workers?
• Michigan is ready to vacation again. Is it enough to save the hotel industry?
• Unable to fill its big hotels, Detroit hopes for business travel rebound
• Emergencies surge at northern Michigan parks, lakes. Time for a rescue tax?

But when the proposed 2022 federal budget for the Department of Labor was released July 10, Ware was stunned by a portion of the budget that could have put a halt to the H-2B visa program for hospitality workers.

“If we were to lose the H-2B program, we would not be able to open the hotel,” Ware said. “The loss of the H-2B program would also result in the loss of an additional 120 domestic positions. 

“All of the businesses on Mackinac Island are dependent on H-2B workers.”

The measure was added to the budget to limit the number of foreign workers who could accept seasonal jobs in the United States in industries with high unemployment. 

The reform was removed later in July, but it underscores the complexity resort businesses in Michigan face as they try to maximize a short tourist season.

“In Michigan, the amount of seasonal work that is available is just way outside of what our domestic population can handle even in regular times,” said Brian Calley, president of the Small Business Association of Michigan. 

“This has become a persistent, annual struggle,” he added.

The state’s hospitality industry employed about 342,000 people in June, down from 436,000 in summer 2019. 

Yet restaurants and hotels all over Michigan are still struggling to hire enough people to meet demand as the labor market recovers from the pandemic. 

The situation is complicated, business leaders and workers say, as former hospitality workers looked to more stable careers, fear the virus, fail to find child care options and, in some cases, rely on unemployment assistance. 

In northern Michigan, where an influx of tourists outnumbers the year-round workforce, the problem is acute. 

“There is simply not enough domestic population anywhere near that area to draw (a full labor force),” said Justin Winslow, president and CEO of the Michigan Restaurant & Lodging Association. “You can be at a huge disadvantage and you only have three to four months to make your entire year’s money.”

Calley said he sees no downside to the H2-B program, in part because it allows the businesses who depend on seasonal workers to fully staff and maximize their seasons.

The program also doesn’t disregard American-born workers who want to work in the tourist industry for a portion of the year, Ware said.

This year, for example, Mission Point had 225 domestic applicants, and 72 responded when they were called. Among them, 68 got job offers, Ware said, and 36 accepted — and nine showed up for work on their first day.

“We work very hard at finding them,” Ware said of non-migrant workers.

“... But we can’t find them, so instead we have this great program where we work with Jamaica or other countries.”

The United States opens 33,000 H-2B positions twice a year for non-skilled seasonal jobs. Last year, Ware said, applications for 98,000 visas flooded the system.

“Each year,” Ware said, “we go through this process where we don’t know what staff we’re going to be able to get through this program.”

This year, 127 H-2B visa positions allow the hotel to fully staff some roles, like housekeeping, that lets it use all available rooms. Some hotels, Ware said, are running at 70 or 80 percent occupancy because of the lack of staffers.

Yet Mission Point still feels the pressure, he said: Chianti, the resort’s farm-to-table restaurant, remains closed this season. During summer, the resort needs 26 cooks, but it now has 13. They’re also making more, now $17 per hour, compared to the federal prevailing wage of $12.

Some properties in northern Michigan were able to gain some visas when the Department of Labor released 22,000 additional ones in May.

However, Winslow said, that puts places like the Grand Hotel behind in their peak season as they train their much-anticipated new workers who are now arriving during their busiest months. 

Critics of the H-2B program say it can exploit workers from other countries and some doubt the workforce shortages. Companies that can apply for the visas get certified to do so, and face penalties if found to violate regulations  — including on pay. 

Some recent penalties in Michigan involved underpayments, including a Traverse City cleaning company that was ordered to pay $56,734 in back wages to 10 workers.

Immigration controversies may color the H-2B program, Calley said, but he said the system has repeatedly proven that workers return to their home countries — and in many cases, want to come back for more seasonal work.

Ware said he hopes that House Bill 3897,  introduced by U.S. Rep. Henry Cuellar, D-Texas, gains traction. So far, it has 12 bipartisan cosponsors, including U.S. Rep. Elissa Slotkin, D-Holly.

The reform bill calls for enhanced protections for workers, but also would change the regulations that set the cap far below demand. 

However, Calley said two measures could help without a law revision: Clarifying how many positions a business can recruit for earlier in the process, and releasing all of the allotments now allowed at one time instead of doling them out in batches, sometimes late in the season.

“People have money in their pockets and they are looking to travel,” Calley said. “If we don't allow entrepreneurs in Michigan, especially in northern Michigan, to take advantage of that opportunity, then we'll miss it. … It needs to be addressed with some urgency.”