Nepal’s hotel and tourism sector stands as a cornerstone of the nation’s economy, contributing approximately 6.6% to the GDP and supporting over 1.19 million jobs in 2023. Despite this significant contribution, the industry faces a paradox: a high national unemployment rate coexists with a critical shortage of skilled professionals, especially in the hospitality sector.
The Employment Landscape: Opportunities Amidst Unemployment
Tourism ranks as Nepal’s fourth-largest industry by employment, engaging around 11.5% of the workforce. In 2023, the hospitality industry alone contributed over Rs 326 billion to the economy, with 142,223 establishments directly employing 106,459 individuals.
The government has also introduced policies like the ban on solo trekking, requiring travelers to hire guides — a move expected to create nearly 40,000 jobs.
Yet, unemployment remains a pressing issue, with thousands of youth entering the job market each year without securing stable opportunities.
The Skills Shortage: A Growing Concern
Despite the abundance of job opportunities, the hotel industry faces a major shortage of skilled manpower. The scarcity is especially severe among chefs, culinary staff, and specialized service professionals. Many skilled workers laid off during the COVID-19 pandemic have since migrated abroad; reports suggest that around 80% of these professionals have found better opportunities overseas.
This shortage affects service quality in domestic hotels, limits their growth potential, and damages Nepal’s international tourism image.
Hospitality Education in Nepal: Supply vs. Demand
To meet the rising demand for skilled professionals, Nepal has witnessed significant growth in hospitality education. Institutions like the Nepal Academy of Tourism and Hotel Management (NATHM), established in 1972, offer Bachelor’s and Master’s degrees in Hotel and Tourism Management.
NATHM has expanded with branches in Birtamode (Jhapa), Bardibas (Mahottari), and Nepalgunj (Banke) to serve students outside Kathmandu Valley.
Currently, Nepal has more than 27 hotel management schools, producing around 12,000 hospitality graduates every year. Furthermore, the Council for Technical Education and Vocational Training (CTEVT) oversees 1,169 affiliated institutions offering diploma and vocational courses, including hospitality management.
However, the reality after graduation is tough. Many graduates struggle to find quality jobs within Nepal and instead look abroad for better salaries and career progression. Even prestigious institutions like NATHM, which have good domestic placement rates, see many of their students migrating to Gulf countries, Malaysia, Europe, and Australia.
This brain drain worsens the already critical shortage of skilled manpower within the hotel industry in Nepal.
Bridging the Gap: Strategies for Sustainable Growth
To address this dual challenge of unemployment and skilled labor shortage, Nepal needs:
1. Enhanced Vocational Training: Update and align training programs with modern hotel industry demands.
2. Retention Strategies: Improve working conditions, salaries, and career development to keep talent inside Nepal.
3. Public-Private Partnerships: Encourage collaborations to create better infrastructure and services for tourism.
4. Policy Reforms: Introduce policies that motivate Nepali graduates abroad to return home and invest their skills locally.
Conclusion
Nepal’s hotel industry has the potential to be a key engine for economic growth and employment generation. However, the mismatch between unemployment and shortage of skilled manpower must be addressed urgently.
By improving hospitality education, retaining skilled graduates, and expanding employment opportunities at home, Nepal can strengthen its tourism sector and move towards a more prosperous future.
