Ouch! Marriott Terminating 66% Of All Corporate Employees

Alarmist is not a word anyone has ever used to describe me before. But this is different.

The crisis surrounding the coronavirus pandemic is mind-boggling and continues to spread in ways that might have seemed unimaginable even just weeks ago.  

A few days ago, Marriott stated that it was going to begin laying off “tens of thousands” of workers around the world due to the drop in travel.

Well, according to the Wall Street Journal, Marriott has expanded that circle and announced that they will additionally lay off two-thirds of the ENTIRE corporate team (both domestically and internationally).

Of the approximate 4,000 corporate employees at the Maryland Headquarters, Marriott is laying off 2,600 stating:

Marriott said the corporate staff furloughs would begin early next month and estimate that they will last 60 to 90 days. During that period, furloughed U.S. corporate employees will receive 20% of their salary, which can be put toward health care and other costs, the spokeswoman said. Corporate employees who stay on are subject to 20% pay cuts and reduced workweeks, the spokeswoman said.

Friday, Marriott CEO, Arne Sorenson, released a 5-minute video to Marriott employees, shareholders, and customers in which he details the reality of the hotel chain. Although the message is depressing, it’s also extremely candid.

“COVID-19 is having a more severe and sudden financial impact on our business than 9/11 and the 2009 financial crisis—combined…In most markets, our businesses is already running 75% below normal levels… The restrictions on travel and required social distancing is having an immediate impact by depressing demand for our hotels.”


The majority of hotels that say “Marriott” on the exterior around the globe are NOT owned by Marriott, they are simply franchised properties. This, to some degree, has insulated corporate Marriott from the crisis because the burden is more on hotel owners. But, with low occupancy and some hotels closing, Marriott’s biggest source of revenue (i.e. royalties from hotels) is also disappearing.

As Sorenson said, occupancy levels at hotels worldwide are down as much as 75% and that’s a massive drop in rooms and revenue.

Marriott expects business to be at historic lows for months. They could always bring employees back early if business rebounds but this is just another sign that these are times we have not seen before.

What do you make of Sorenson’s message and the numbers that are mentioned?

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