Downturn, flu take heavy toll on big hotels

    High-end hotels are being hit by a double blow: the economic downturn and the H1N1 flu outbreak.

    In extreme cases, occupancy levels have fallen to just 3 percent of capacity, according to anecdotal evidence.

    In addition, wages are being slashed, staff are being laid off, the number of interns hired is increasing, employees are being told to move back into on-site accommodation and generous expatriate contracts are not being renewed, according to Monday's China Daily.

    "It's slash and burn," said an expat chef at one five-star hotel in Beijing, who was recently asked to resign or face being sacked and asked not to be named, "During the Olympics, rooms were going for 6,000-7000 yuan a night. Now they are going for 550 yuan."

    According to recently-released figures from the Beijing Bureau of Statistics, the average occupancy rate at the city's star-rated hotels was 44.5 percent during the first quarter, down 10.1 percentage points from a year ago.

    Meanwhile, economy hotels in the vicinity of luxury hotels are becoming more popular.