Over the past several months, things have changed dramatically at Disney World and around the world due to the COVID-19 pandemic. One of the biggest things we’ve been keeping an eye on is the situation with Disney’s Cast Members — furloughs, layoffs, and hirings.
As Walt Disney once said, “You can design and create, and build the most wonderful place in the world. But it takes people to make the dream a reality.” What happens when a lot of those people who make the dream a reality are furloughed or laid off, and then things change and thousands of Cast Members are needed to fill the parks again? We’re taking a look at that today and just what Disney might have done that could become one of its biggest regrets.
Effects of the COVID-19 Pandemic
In 2020, the COVID-19 pandemic changed a lot of things for people and businesses around the world, including the Disney company. In 2020, Walt Disney World closed, Disneyland closed, and basically all of Disney’s theme parks closed around the world at one point or another. Disney Cruise Line stopped its sailings, movie theatres closed, many restaurants and stores closed or changed how they conducted their businesses, and more changes were made.
Some of the things that were ordinary parts of our everyday lives shut down. And those shutdowns lasted for a longer time than many may have anticipated.
For several months, there really was not much for many Cast Members (especially those that worked on the front line in the parks) to do.
And even after the parks and some hotels initially reopened, not all of Disney World reopened in the same way. The parks and hotels opened with capacity limitations, and several restaurants, rides, and hotels remained closed during the initial reopening phase.
Many spots remained closed for several weeks and months, and some are still closed today.
It Started With Furloughs
It all began with furloughs. At first, Disney announced that there would be a “temporary, short-term furlough for executive, salaried and non-union hourly Cast Members based in the U.S. with the exception of those whose roles or projects are crucial to maintaining our operations during this closure period, effective April 19th.”
We thereafter saw Disney reach an agreement on furlough policy for union members, and a furlough agreement was reached between Disneyland and union security employees. Ultimately, about more than half of Disney World’s union workers were furloughed due to an agreement.
During that time, we took a look at just how much Disney might be saving by furloughing employees. Even after the parks reopened, Disney World warned Cast Members to prepare for extended furloughs and more Disneyland Cast Members were furloughed in December of 2020.
Then Came the Layoffs
In September, the situation went from furloughs to layoffs. Disney announced layoffs that would affect 28,000 employees. In the coming weeks, the layoffs continued and impacted many Cast Members at fan-favorite shows and more.
Ultimately, the layoffs were increased and impacted about 32,000 employees, primarily in the Disney parks. While continuing to share updates about these layoffs, we also worked on compiling a list of ways that guests could help Cast Members who were furloughed or laid off.
Now, Things Have Changed
Gradually, over the last few months, however, things have dramatically changed for the Disney Company. Slowly, Disney’s theme parks reopened, and now all of them are open once again.
More restaurants have reopened, more hotels have reopened, capacity has increased at the parks and is set to continue increasing in the future, more rides have reopened, fireworks have returned to the parks, and other things have returned to “normal.”
But, not everything is back to “normal” yet. Some rides and locations are still closed. We saw a booth at the EPCOT International Flower & Garden Festival closed for a period of time due to staffing issues, and other spots reportedly closed for the same reason. If you visit Disney World now, you’ll find many spots may not be open as late as they used to be, or they may not be serving during as many meal times as they used to.
Still, with more things reopening and greater capacity, more guests are visiting the parks than a year ago. And if there are more guests and more spots that are open, Disney naturally needs more Cast Members to keep things running.
Disney is Hiring a LOT of People
So, months after Disney furloughed or laid off thousands of its Cast Members, it needs thousands of Cast Members back again to keep things running. And it shows. Disney has been posting A LOT of positions for which they are hiring lately.
We’ve seen posts for everything from attractions Cast Members, to positions for custodial, merchandise, and quick-service foods spots.
But, filling all of those empty positions may not be as simple as it sounds.
Across the United States, employers from a wide variety of industries have complained that it is difficult to find workers. According to the Washington Post, some have alleged that the President’s stimulus packages for Americans has “created a massive labor shortage.” According to Senate Minority Leader Mitch McConnell, what he’s heard from business people, hospitals, and more is that “it’s actually more lucrative for many…Americans to not work than work.”
CNBC shares that employers are “going to new lengths” to attract workers including by dropping certain requirements or offering bonuses. As the holiday season approaches, CNBC notes that many companies’ desire to fill their job openings has started to take on a greater sense of urgency.
According to Nick Bunker, an economic research director for North America at Indeed Hiring Lab, the labor market’s bargaining power has shifted toward job seekers. CNBC reports that the numbers show this shift. The U.S. hit a record of more than 10 million job openings in June, and quit rates have grown the fastest in industries typically associated with lower pay.
Marc Perrone, the President of the United Food and Commercial Workers International Union shared that the risk of getting COVID-19 has opened some workers’ eyes and caused them to leave the industry. Others have been waiting on the sidelines as they received unemployment payments that were higher than their wages.
In the tourism industry specifically, NPR notes that other spots have shared that they’re struggling to find enough workers to keep things open. One individual noted that they have more domestic staff than they did in 2020 and 2019, and that they’re getting employees through recruiting efforts, sign-on bonuses, and new competitive wages.
Could Disney and some of the restaurants located at Disney be experiencing a similar situation with a difficulty finding employees? It’s possible, at least based on the hiring incentives we’ve seen them offering. We’ve seen some Disney World restaurants offer $1,000 or $500 hiring bonuses. Disney has even announced a Culinary Job Fair and Housekeeping Job Fair, both of which will offer $1,000 bonuses to new hires for select positions.
All it takes is a quick look on the Disney jobs site and you can see how many positions are being advertised with hiring bonuses.
Of course, Disney isn’t disclosing why they’re offering the bonuses, but if they are struggling to find people willing to fill these positions, it seems they wouldn’t be the only ones.
There could also be a variety of other factors at play. For example, some of the programs where employees used to come from (for example, the international program), are not back yet, meaning there are even more spots to fill up without the traditional channels typically used to fill them.
So, Has Disney Shot Itself in the Foot?
So, this is where a critical question comes in: has Disney shot itself in the foot? Did Disney make a series of decisions surrounding the furloughs and layoffs that have now left them in a difficult position?
Did Disney perhaps lay off too many individuals? It’s certainly possible. Perhaps Disney thought that those individuals would likely come back or that it would be relatively easy to re-hire many of them when the time came and those jobs opened up. But, it’s possible that many of those individuals, while waiting for a job offer from Disney that may not come, ultimately found other positions which they are now set in.
Disney, however, seems to indicate that they have had no problem getting Cast Members to return. According to statements made by Disney CEO Bob Chapek at the Q2 2021 Earnings Call, about 80% of the Cast Members that Disney has asked to return have in fact come back. According to Chapek, Disney has “had no problems whatsoever in terms of trying to get our cast to come back and make some magic for our guests.”
But, the Q2 Earnings Call was held back in May. It’s possible things have continued to shift over the following months.
Should Disney have kept more employees on furlough rather than laying them off? It’s possible. It’s possible that by keeping them on furlough, they would have kept waiting for these future positions to open up and would have quickly returned, making Disney’s ability to re-hire individuals smoother.
How many Cast Members still remain on furlough? That’s unclear. We have a slightly better idea of what’s going on over at Disneyland though.
According to The Orange County Register, about “2,500 Disneyland cast members who had been furloughed or laid off last year returned to work in July.” Disney officials have indicated that “Disneyland has offered to rehire 85% of the cast members who were laid off or furloughed.”
But, Disneyland union members held a rally recently to call on Disney to restore more jobs and raise pay, as some Cast Members still remain on furlough or laid off.
Could the number of layoffs and furloughs all end up being one of Disney’s biggest regrets? That’s possible. It’s possible that because of the high number of individuals furloughed/laid off, the sudden need now to fill empty positions, and the potential impact of the worker shortage being felt across many industries in the U.S., Disney has had to delay bringing back certain experiences or reopening more spots.
As they say, hindsight is 20/20 though. Whether the handling of the furloughs and layoffs ends up being a regret for Disney remains to be seen.
But, Disney seems determined to fully staff its parks again soon. During Disney’s Q3 2021 Earnings Call, Christine McCarthy, Senior Executive Vice President and Chief Financial Officer for Disney, said that they’re expecting to have the domestic parks “fully staffed up by the end of this calendar year, calendar 2021.” So, perhaps hiring is not an issue and the hiring bonuses are not indicative of a worker shortage or perhaps they’re indicative of a small and not terribly significant worker shortage.
Only time will tell whether the domestic parks do reach that full staffing by the end of the year, when other programs (like the international one) will return, and how the situation moves forward. We’ll keep an eye out for more updates and let you know what we find.