Marriott CEO says coronavirus is ‘like nothing we’ve ever seen,’ cuts his salary to $0
Marriott (MAR) CEO Arne Sorenson has announced that he will not be taking a salary for the rest of the year, responding to the fallout from the coronavirus.
“In terms fo our business, COVID-19 is like nothing we’ve ever seen before,” Sorenson said. “For a company that’s 92 years old, that’s borne witness to the great depression, World War 2, and many other economic and global crises, that’s saying something.”
He added: “I will not be taking any salary for the balance of 2020 and my executive team will be taking a 50% cut in pay.”

Arne Sorenson, president and chief executive officer of Marriott International Inc., at the White House on Tuesday, March 17, 2020. (Photo: Kevin Dietsch/UPI/Bloomberg via Getty Images)
Hotel industry reeling from the shock
The hospitality industry has been crushed due to the coronavirus, or COVID-19, as occupancy rates plummet due to various restrictions.
“The principal change we face… the restrictions on travel, gatherings of people and required social distancing is having an immediate impact by depressing demand for our hotels,” Sorenson said in the video message.

Major hotel stocks year-to-date as of Friday morning. (Yahoo Finance)
The stocks of major hotel companies are down plummeting. Aside from Marriott, the world’s largest hotel company, other major other hotel chains started closing locations and began furloughs or layoffs for tens of thousands of employees across the world.
U.S. hotel revenues per available room have declined more than 30% relative to how they were trending before the virus hit, for the week ending March 14, according to a recent note from J.P. Morgan, utilizing data from Smith Travel Research.

The week of March 8-14 this year, as compared to the week of March 10-19 last year also revealed a shocking decline, research from hotel data firm STR revealed. Occupancy rates had gone from 53% last year to -24.4% this year. The average daily rate for rooms has dipped more than 10%, and the revenue per available room has dropped by 32.5%.
Strain on the U.S. economy
The U.S. economy at large is showing signs of strain because of COVID-19’s impact on businesses.
Initial weekly claims for unemployment insurance jumped to 281,000 during the week ending March 14, up from 211,000 the week prior, and it was much worse than the 220,000 expected by economists.
In the meantime, beyond the steep decline in domestic and international travel, many Americans are scrambling to find ways to stay afloat after losing their jobs.
“My girlfriend works for Marriot [sic] and basically lost her job,” one person on Reddit wrote. “They told her they’ll call her when they need the staff again. She tried to apply for unemployment and was denied because Marriot has her as an employee who works 0 hours. So for the time being I’m taking over her financial responsibilities.”

Airlines are another industry severely hit by the coronavirus. (David Foster/Yahoo Finance)
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Aarthi is a writer for Yahoo Finance. She can be reached at [email protected]. Follow her on Twitter @aarthiswami.
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