SA Leads Nation – But With A Warning

South Australia's hotel sector is “bucking the national trend”, posting consistently strong occupancy rates compared to any other states .

While accommodation markets across Australia show signs of slowing or stagnating, SA continues to deliver consistent month-onmonth results.

James Goodwin, CEO of Accommodation Australia, said this performance was the result of “smart diversification”.

“South Australia’s operators have deliberately built a market that doesn’t rely on just one type of visitor,” he said.

The state is attracting a mix of general tourists, event-goers (eg. LIV Golf, Gather Round, Festival and Fringe), business guests and regional visitors which is helping hotels stay busy even in traditionally quiet periods.

“It’s about evening out the peaks and troughs,” James said.

“Instead of boom and bust months, we’re seeing a more stable rhythm in bookings in SA.”

That stability is being noticed.

In a national environment where some regions are struggling to fill rooms mid-week or outside school holidays, South Australia is emerging as a model of how to broaden demand.

“Adelaide has grown its reputation as a year-round destination,” James said.

“Big-ticket events, regional attractions, corporate travel and international education are all helping to fill rooms.”

COST - OF - DOING - BUSINESS CRISIS

However, the head of Australia’s peak accommodation warned that solid occupancy doesn’t automatically translate to strong profits.

“There’s a risk that high occupancy can give a false sense of security,” he said.

“Operators are working harder than ever to achieve those numbers,

Oatley Fine Wine Merchants, South Australia’s leading on-premise wine distributor to trade. Proud Silver Partner to the AHA SA. Orders or enquiries - 1800 628 539 or orders@oatleywines.com.au and in many cases, margins are shrinking.”

Across the country, the hospitality and tourism sectors are grappling with rising costs.

Accommodation providers are being hit with higher bills for electricity, insurance, food and beverage supplies, maintenance, technology and compliance.

“There’s been a lot of media attention on the cost-of-living crisis, and rightly so,” said James.

“But what’s not being talked about enough is the ‘cost-of-doing-business crisis’.”

James said operators are being squeezed from both sidesincreased expenses and a customer base that’s more sensitive to price than ever before.

“Guests want more for less, and businesses want to deliver, but the economics are tough,” he said.

“In some cases, it means cutting back on services or delaying upgrades, which is not sustainable.”

SKILLS SHORTAGE SHIFT

Labour is another area where the industry is facing a significant shift.

“We’re not seeing the same workforce shortages we had during the peak of the pandemic recovery,” James said.

“Now it’s more about the type of workers available — it’s a skills shortage.”

He said while many hotels are now able to fill roles, they are often struggling to find staff with the right training or experience, particularly in specialist areas like revenue management, kitchen operations and maintenance.

“People think hospitality is all about reception desks and housekeeping, but there’s a whole layer of professional expertise that’s essential,” he said.

“There are roles where you can’t just fill the gap with someone inexperienced and expect the same outcome.”

Accommodation Australia is now working with government and training providers to identify workforce priorities and improve access to skilled migration pathways.

“There needs to be a pipeline - not just for entry-level workers, but for leadership and technical roles too,” said James.

Despite the challenges, he remains optimistic. The industry is proving its resilience, adapting quickly to changes in the market and