New York City’s hotel workers are on course to earn six figures after signing the most expensive industry union contract ever.
The new settlement avoided a strike this summer that risked disrupting tourists arriving for the World Cup and America’s 250th celebrations.
The deal will increase hourly wages by roughly 50 per cent over eight years, with housekeepers expected to earn more than $100,000 (£74,500) by 2032.
However, visitors will probably end up footing the bill.
New York City already has the highest room rates of any large city in the US, averaging $334 (£248) a night.
That price is set to rise again because of fuel price increases accelerated by the war in Iran.
Zohran Mamdani, New York’s mayor, expressed his support for the deal signed last week, saying the wage rises are necessary for workers to be able to afford their own rent in the city.
Mayor Zohran Mamdani speaks during a press conference at a union strike in New York City – Michael M. Santiago/Getty Images
Mr Mamdani rose to power on promises to champion the city’s working-class and to tax the wealthy. He is often photographed on picket lines, rallying behind workers’ demands for better wages and benefits.
“New York is, and always will be, a union town,” Mr Mamdani said in response to an agreement that avoided a strike by the city’s doormen last month.
Unions have been particularly active this year, securing big raises for workers. A strike by the main nurses’ union this month saw salary increases of more than 12 per cent during a period of three years, while striking commuter train workers – already on salaries of $135,000 (£100,543) – won pay increases.
The hotel workers’ union said that its new contract would raise the pay of housekeepers from just under $40 (£29.78) an hour to more than $61 (£45.43) an hour by 2034. On July 1, their annual pay will start at $77,113 (£57,431).
Critics of the deal argued that some hotel workers already earn more than junior firefighters and police officers, along with some teachers.
“We started negotiations at $40 per hour,” one hotel owner on the bargaining committee told the New York Post. “The person who cleans your room will be making more than school teachers and policemen.”
New York will host eight World Cup matches this summer.
Vijay Dandapani, president of the Hotel Association of New York City, praised the contract, telling The Telegraph that avoiding a punishing strike “saved hotel owners hundreds of millions of dollars and the city millions in taxes.”
But he argued that hotels face trouble ahead, given high operating costs, the oil price hike caused by the Iran war, and reduced visitor numbers since the pandemic.
“There is just lower demand, we expect a bit of a bump during the World Cup but nowhere near what we were promised. This year for New York City hotels is looking to be behind last year in terms of revenue.”
Indeed, hotel occupancy forecasts for June, when the tournament begins, are 12 per cent lower than last year, according to the data firm CoStar.
Experts say rising costs are unlikely to mean luxury hotels facing lower demand, but mid- to lower-budget hotels will feel an impact, because fewer Americans and foreigners will have the necessary spending power to visit.