The tourism industry is a major employer in Australia and has particular significance in regional areas. A great benefit of the accommodation sector of the tourism industry is that it creates a range of employment opportunities. However, this benefit is also a weakness when labour costs and availability are under pressure. This research on labour turnover and cost in Australia was undertaken with a purpose of offering an insight into this vital issue for the accommodation industry. An on-line survey was utilised to collect data from 64 hotels. The research shows major costs being attributed to labour turnover. These are costs which both the industry and individual operators should examine closely as they impact substantially on the operating costs and profitability of these businesses. The research findings have contributed to the development of the policy agenda of the accommodation industry in Australia and the need for accommodation businesses to re-visit and analyse their own labour and cost experience.