This Fourth of July, fireworks aren’t the only thing soaring in New York City. Hotel prices are set to reach a new high, thanks to a union contract that takes effect on July 1.
The Hotel and Gaming Trades Council’s newly ratified contract with hundreds of New York hotels locks in an unprecedented wage increase that could throw the industry off its already shaky axis. Under the agreement, hotel workers’ wages will exceed $40 an hour this summer and could approach $60 an hour by the end of the eight-year contract.
The union’s current contract was set to expire just as World Cup tourists flooded New York City. HTC President Rich Maroko leveraged this timing, threatening a strike at the city’s peak of tourism.
He’s not the only union leader to take advantage of the games. In Philadelphia, Seattle, and Los Angeles, hotel worker unions are threatening to strike just as tourism hits its peak — unless hotels capitulate to their demands.
But it’s not just tourists who will pay for these unprecedented wage hikes in the form of higher costs and service cut backs. It’s the workers themselves.
Hotel operators warned that this latest contract — which kicks in next month — will significantly increase operating costs and inevitably push room rates even higher. At a moment when New York is already struggling with affordability concerns and fierce competition from other World Cup destinations, that should concern anyone who depends on tourism for a living.
Employment in New York’s hospitality sector was growing before the pandemic hit. But hotels struggling to rebound from massive COVID losses were locked in to HTC’s previous contract, which continued to hike hourly wages by $1.00 annually. Now at the contract’s end, hourly wages for room attendants are just under $40.
Labor costs continue to rise, but the city’s hospitality sector is far from recovered. Since March 2025, the city has lost roughly 14,500 leisure and hospitality jobs. The rest of the city’s private employment has bounced back, and is currently well beyond 2019 levels.
New York isn’t the only city where mounting hotel wages threaten industry recovery. In Los Angeles, hotel workers thought they were hitting the jackpot with a city-wide minimum wage ordinance that passed in 2022. The law raised the minimum wage for most area hotels to nearly $19 an hour, with scheduled increases built in.
Following the wage hike, employment in the city’s hospitality sector tanked. The latest data shows hotel jobs were down 1.7% in Los Angeles County in December 2025 compared to the year prior. Outside of COVID, that’s the largest year-over-year drop for the industry in a decade.
That hasn’t stopped the city from doubling down on this misguided policy. A new ordinance is set to raise wages for hotel workers to $30 an hour by 2030. Los Angeles hotels have warned the latest wage increase could hurt the hospitality industry, discourage investment, and threaten the city’s ability to host the 2028 Olympic games. Already, hotels have been forced to lay off workers and several have pulled out of room blocks initially planned for the summer games.
As wages climb toward $60 an hour in New York, and tourists recoil at sky-high room prices, hotel operators will face powerful incentives to find ways to reduce labor costs elsewhere. Operators are already planning to schedule fewer employees, reduce hours, cut back on guest services, and push automation.
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HTC’s president may get the credit for negotiating this latest contract, but his nearly $1 million compensation package is largely insulated from these economic setbacks. Meanwhile, the workers whose dues pay his salary will bear the long-term consequences of the deal.
World Cup visitors may be the first to feel the pain of higher room rates, but hotel workers could end up being hit the hardest by seeing their shifts reduced, or worse — having their jobs disappear.
Charlyce Bozzello is communications director at the Center for Union Facts, a nonprofit organization that fights for transparency and accountability in America’s labor movement.