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Most work on Boyd Gaming’s $4.8 billion Echelon project on the Strip has stopped. It will open about a year later than planned, Boyd says.
Saturday, Aug. 2, 2008 | 2 a.m.
Reader poll
Beyond the Sun
Ironworker Jerry Ciciliano had been on the job for a couple of hours Friday morning when he discovered that within days — or hours — he’d be out of a job.
A friend had just passed on the news that work on Boyd Gaming’s big resort project, Echelon, was being shut down until the economy improves.
Ciciliano’s boss called the story “a bunch of bull,” but a half-hour later, his boss was back on the two-way radio saying the rumors were true. Later, Ciciliano, 59, was nursing a beer at Brando’s, the bar and video poker joint across the street from the job site.
The place was packed with ironworkers, carpenters and laborers, many waiting to collect their final paychecks and trying to make sense of the news. Some said they’d been drinking since 9 a.m., when word of the layoff began to reach the workers.
“It was a shock. It’s hard to believe they’d go that far (with the project) and then quit,” Ciciliano said.
Rumors flew about how long the shutdown would last.
Boyd Gaming announced Friday morning that the $4.8 billion resort on the Strip, which it had planned to open in 2010, would be delayed for perhaps a year. But some industry analysts think postponement could be extended, depending on when the financial climate improves.
Ciciliano is a Las Vegas native who’s been on jobs for 40 years, so he figures he’ll be all right. But he said he worries about the young people just starting out.
Even as residential construction shed thousands of jobs this year, highly paid union jobs on Strip projects had remained a bright spot for construction workers in the city — and across the country. Veteran trades workers flocked to Las Vegas as unions advertised plenty of work to go around on their job hotlines.
“It was totally unexpected. We were supposed to work tomorrow,” said Mario Aguilar, 50, who’d come to Las Vegas from Los Angeles in April.
The 800 workers who had been working at Echelon include 500 carpenters and 200 ironworkers. The loss could be more deeply felt than that, however, because the job was still revving up and was to include many more workers, topping out at about 4,000.
A few workers will continue to work at Echelon, some of them finishing construction on complex structures that can’t simply be abandoned, Boyd Gaming spokesman Rob Stillwell said.
Aguilar is not only out of a job, he’s also lost his housing.
The company had been putting him up at Circus Circus, but the deal is off now, Aguilar said.
He’ll probably pay for a few extra days while he weighs his options. A friend might get him a job at the Fontainebleau high-rise resort, or maybe he’ll go back to Los Angeles — and risk burning more gas to get to a job site.
His union, Ironworkers Local 433, couldn’t fill work orders this week, he said. Now he worries the union will have more people than it can put to work.
Unions say those concerns are unfounded, but they still worry about what the Echelon news portends.
“In our initial assessment, we think for the most part there is enough work in the pipeline that most folks will get absorbed rather quickly,” said Steve Redlinger, spokesman for the Southern Nevada Building and Construction Trades Council.
That’s because some large construction projects are not yet at their peak staff numbers, such as McCarran International Airport’s Terminal 3 and the Fontainebleau. MGM Mirage’s $9.2 billion CityCenter, meanwhile, employs thousands of workers a day.
But officials say they’ll still have to reassess some assumptions.
“I was getting the feeling from Boyd that they would start manning up just as CityCenter was manning down, and they would roll that workforce into the Echelon,” Sheet Metal Workers Local 88 Business Manager John Christiansen said. “Hopefully it might still work out that way.”
Christiansen said just a handful of sheet metal workers were at Echelon, but the union was expecting more work there before long.
State economist Jared McDonald said the Echelon news has prompted the Employment Department to reconsider projections for construction work in the state.
“The one thing we had to look forward to was all the construction jobs until the casinos come online,” McDonald said. “This is really going to dampen things.”
Industrywide, the state is down 13,200 construction jobs from last year, McDonald said. That’s a 9.6 percent drop for an industry that employs about 11 percent of workers in the state.
McDonald’s sentiment was echoed by union officials as well as workers.
“This kind of puts a damper on everyone’s sense of where the future is,” said Marc Furman, president of the Southwest Regional Council of Carpenters.
Sun reporter Liz Benston contributed to this story.
High gas prices are killing Las Vegas.
Democrats, Reid, Obama and Pelosi have locked up trillions of dollars of oil and gas for decades and continue to do so.
That has hurt us, is hurting us and will continue to hurt us.
Ms. Taxus (Titus) once was against offshore drilling. Now she is OK with a little of it with special special special conditions. At least a little is better than nothing.
Not only is Boyd laying off hundreds of construction workers now but the shutdown means the thousands more they were planning to add will be lost as well.
This is just the latest example of GOP trickle-down economics in action. Our nation's economy is in a deep hole and getting deeper everyday because Americans chose to have an idiot in the WH for the last eight years. We're getting want we deserve.
If you want more of the same keep voting republican. Failure is their only policy.
Does anyone think that now is the time to call in Immigration Agents (ICE)? During the past years the amount of illegals working on casino construction sites has drastically increased. Today with the shutting down of work on Boyds' property, American union construction workers here in Las Vegas are fearing the worse is yet to come. With many future projects being put on hold, we will be seeing more union construction workers lining up at their union halls waiting for work. This fact is clear, we have got to send the illegals back to their countries so we can put our Americans back to work.
I think everyone in Vegas has been brainwashed to believe uncontrolled growth is the norm and will continue forever.
Does anyone really believe it is viable to keep adding thousands of hotel rooms each year? Or to keep building massive sub-divisions far into the desert?
We have seen it time and time again that things cant grow at high rates forever. Look at the dot coms, look at housing prices, ....
Vegas recent growth was built on cheap energy and an artificially booming economy (due to housing speculation) - those days are over.
Does anyone think the price of energy is related to all this. Visitors facing higher gas prices at home after putting it in no paying slots called gas pumps, and with higher air fares and fewer flights. They layoffs in construction is the start. Next it will be service workers of all kinds. What happens when a big show closes and none replace it. Trickle down is the energy policy of Sen. Reid. Cut the guts out of Las Vegas and watch the city shrink. Less workers, less everything, less students and school layoffs are next. Call Sen. Reid and tell him to drill everywhere, build nuclear plants and mine oil shale. Keep 700 billion a year here and the jobs producing energy as well. Open the desert for solar and stop the environmental suits to save the desert so we can live.
High gas prices is killing our jobs.
One day it might be your job.
Even the precious government jobs are at risk.
Most likely Nevada will have a two or three year recession. Do not expect state revenues funds to be much different next year.
Again.....trillions....trillions....trillions of oil and gas has been locked by the Democrats, like Reid, Obama and Pelosi.
They are stubborn. They could care less if the price of gas is $50 in 10 years.
Really; it's the Republicans and/or the Democrats and/or immigrants faults Vegas is having trouble for the past 12 months??? How do you figure??? Isn't that really just your adgenda... Seems to me people might agree with you more if you actually made sense.
Like a previous user said, nothing stays the same forever, and Las Vegas wasn't even 1/10 of what it is today before the 1980's, and it's totally unrealistic to believe that that type of growth can continue exponentially. The 2002-2007 boom was created by high disposible income for non-gaming activities and that market is saturated here now.
Our current downturn is totally due to energy costs which have risen because of the westernization of Asia (China and India specifically), not some domestic policy change. Our domestic policy on energy has been the same for the past 5 presidents on both sides of the fence. Politicans are always reacors, not proactive.
Occupancy rates are still over 90% in this city and we are raking in $1B a month in revenue a month in the state still from $1.1B last year. The retail and non-gaming parts are what are hurting us the most, and once the energy problem is fixed that should turn around as well.
Immigrants are leaving in high numbers, but regardless of that by law and/or union contracts they cannot do the high skilled labor jobs that most of the 800 people on site were doing. Immigrants were responsible for building most of the houses here, landscaping and general labor, not work on the strip.
The sky is not falling, we don't have 20% unemployment, we don't have energy rations, there aren't riots for bread. This city is still as desireable as it has ever been and I for one don't really see that changing, this place is an engine for progress...
Democrats fillibuster offshore and ANWR laws.
Clinton vetoed ANWR.
If he did not vetoed ANWR then there would have been another 2 million barrels in supply today.
The reason why gas prices are so high is because the capacity of supply is so marginal above peak demand during the summer.
If we had that 2 million daily that the safety margin would be higher.
It would have reduced anxiety in the market place fearing a war or a storm would reduce supply below demand.
Las Vegas is getting screwed over.
People are losing jobs because of the high gas prices.
That is funny, jfnance32. I think they said ANWR would mean gas prices would be a penny cheaper than they are now.
I do not think a penny is killing us. Otherwise, if gas prices went up by a penny, everything would shut down!
But the republicans had a week to vote to help us out, and they didn't! They sat around and whined!
And then Harry Reid said they could amend to drill, but they didn't do anything!
The republicans just whined some more! And then they didn't vote to give pay raises and armored humvees to troops and medical care to veterans!
Then they had a party to celebrate that they didn't help us! They turned out the lights and cheered!
We will remember this in November, Jon Porter!
You do not understand on why gas prices are so high.
If it was a normal market than purhaps the one penny might be true.
The reason why gas prices are so high is because the capacity of supply is so marginal above peak demand during the summer.
There is so much anxiety in the market place because any event could push demand over supply.
The ANWR 2 million barrels a day would have greatly reduce that anxiety and greatly reduce oil prices.
The House and Senate is fully under control of the Democrats.
The Democrats have majorities in both in the House and the Senate so they can pass anything they want to.
All the Republicans wanted was a full and free debate where they could offer amendments that the Democrats can easily vote down if they wanted.
The Democrats did not want to vote on some things because it would embarrass them to vote no or they would voted "yes" and things would have passed that Pelosi and Reid did not want to pass.
I do not believe you are telling the truth.
The government said: "In all three ANWR resource cases, ANWR crude oil production begins in 2018 and grows during most of the projection period before production begins to decline. In the mean oil resource case, ANWR oil production peaks at 780,000 barrels per day in 2027. The low- resource-case production peaks at 510,000 barrels per day in 2028, while the high- resource-case production peaks at 1,450,000 barrels per day in 2028."
We would not see 2 million barrels per day. We would probably see 780,000 a day, but may only see 510,000 per day. That is less than half of what you said! And I can't wait until 2028 for help!
You are funny. All of the newspapers reported that the republicans refused to vote. They blocked cloture votes.
I guess you do not know how the house and senate work. They have to have 60 votes to close debate. The republicans refused to vote!
They did not want to do anything to help us! Harry Reid gave them a chance and they said NO!
We shouldn't have to wait until 2028 for help! The republicans had a chance to help us but they said NO!
Then they had a party! That is shameful. They are indefensible!
I guess you and the republicans think we should wait until 2028 for low gas prices?
The republicans need to vote to help us now!
'I guess you do not know how the house and senate work. They have to have 60 votes to close debate."
Democrats wanted to close debate because they did not want to debate at all.
Reid at first said no amendments by Republican.
Then he offer 4 by both sides and limit 5 minutes for each amendment.
All the Republicans wanted was a full and free debate where they could offer amendments that the Democrats can easily vote down if they wanted.
The Democrats did not want to vote on some things because it would embarrass them to vote no or they would voted "yes" and things would have passed that Pelosi and Reid did not want to pass.
No, the Republicans wanted to grandstand. There is a huge difference... made all the worse by their frat party after the House was dismissed.
They turned down Reid's offer to compromise, clear as day. People can try to couch that in whining about it not being fair, but the simple fact is: when given a chance to act, the Republicans chose to whine.
In the face of actual action, they chose to appeal to pity.
These aren't new rules. They've been in effect in the House and Senate for hundreds of years.
It's time to replace the Republican neophytes in the House and Senate who aren't aware of how to legislate.
Unbelievable! Same political debate with this story as with the other headline. Do you guys just cut and paste?
You guys (and gals) are really missing the true reason for this story. Again, say what you want about the high price of gas, but that isn't what's causing the Boyd group to delay the Echelon. It's the same thing that is causing the decay of the housing market: irrational exhuberance. These projects are just way too over-leveraged. The financial institutions are reeling from the housing mess, and not willing to lend money right now... especially around $3 billion. And it could be a while before they do.
I'll check back in a while and see how the political debate is going...
I hope that you are Obama's campaign manager and advise him to say: "Las Vegas economy has nothing to do with high gas prices."
I guess you think the 1/3 drop in stock value of the gaming stocks has nothing to do with tourist not coming to Las Vegas due to high gas prices.
Yea....the only reason why Echelon was delayed was due to "irrational exhuberance". It has nothing to do with the large drop in tourists coming to town. And the drop in tourists is just a big concidence with the spike in gas prices.
I guess this is a bogus story:
"Southern California gamblers who regularly drive to Las Vegas have cut back their visits by a third because of record gas prices, and those who still come say they’ve cut their gambling back by 29 percent, a new poll has found."
"About 48 percent of the polled Southern California gamblers in 2005 said gas prices had affected their decision to drive to Las Vegas casinos"
http://www.iht.com/articles/ap/2008/06/1...
This story must be false too:
"Airline cuts, high gas prices making Las Vegas tougher to get to and more expensive"
"US Airways Group Inc. announced last week that it was cutting nearly half its Las Vegas flights as part of companywide belt-tightening"
http://www.lasvegassun.com/news/2008/jul...
Even the prostitues are hurting.
"High gas prices affect everything,” she said, lamenting a recent drop in business from the truckers and tourists who regularly make the long trek to her brothel, located near Death Valley and 130 miles northeast of Las Vegas."
http://www.timesrecordnews.com/news/2008...
Harske, you're right. Only the most naive could look at Echelon's delay and blame it on a single factor like gas prices.
To put it simply, if gas prices are supressing development, how is CityCenter still being built?
Both properties were feeling the credit crunch, Echelon just got bit faster because they started later. These are billion-dollar developments that can't be financed without major backing capital. That capital market isn't interested in building in these market conditions.
And because of the credit crunch, brought on by the deregulation of lending practices and the collapse of the housing market, everything suffers. People can't get loans to buy cars or furniture or other big ticket items which caused our state revenues to plummet. Our over-reliance on the gaming sector and their loss due to the economy tanking just made the situation worse.
So while some may worry about how the prostitutes(!) are doing, I'm more worried about the loss of jobs and tax revenue that will suffer because of this.
I did not say the only reason for Echelon delay is high gas prices. I did not use the "only" anywhere.
I am OK if you want to promote the idea that high gas prices is having little to no effect on the Las Vegas economy and gaming revenues.
If you want to put an ad on a billboard next to a highway then I will pitch in.
Here is what it should say:
"Message from the Democrats, including Obama and Reid:
We believe that high gas prices are not having a significant effect on gaming revenues or the Las Vegas economy.
Vote for us!!!!"
Tell me how much it is. I look into sending in a check to the ad agency.
FYI...Center City will probably delay parts of its project beyond what they were planning for. I am willing to take a bet on it.
jfnance I believe you have gas on the brain. Oil and gold are valued by the dollar. The dollar is worth $.04 cents these days. Hence the price of gold today and the price of oil. You've been pointlessly arguing with people since 6am. Get a life.
What fremmasmind said. Gas has been getting more expensive because:
1) The dollar is in the toilet due to the Fed's low interest rate policy and financial sector bailouts. Now that it is explicitly being backed by imploding Fannie & Freddie garbage, look for it to fall much further (i.e. dollar-denominated oil to rise much further).
2) Investors have been fleeing equities and seeking safety in commodities (oil, for example)
3) Cheap, easy-to-refine oil is becoming scarcer
In that order.
You are correct that the value of dollar has played a role in gas prices.
But the price of oil has gone up faster than the decline of the dollar which is a big ding your arugment.
Here is article from the Federal Reserve System.
http://www.dallasfed.org/research/eclett...
Early in the article they say: "A good starting point is strong demand, which has pushed world oil markets close to capacity. New supplies haven’t kept up with this demand, fueling expectations that oil markets will remain tight for the foreseeable future. A weakening dollar has put upward pressure on the price of a commodity that trades in the U.S. currency. And because a large share of oil production takes place in politically unstable regions, fears of supply disruptions loom over markets."
They say that are three causes:
1) Demand growth has outstripped supply growth and have greatly reduced the capacity of supply over peak demand.
2) Fall in the value of the dollar
3) Anxiety expectations that any event can push supply below demand.
You can write a letter to the Federal Reserve and tell them to get a life.
The cause of the great depression: The federal reserve(which is not owned by our government) makes our money and sells it with interest to our banks. They charge interest to the banks and do not expect total payback immediately. Before the great depression stocks were being sold for only ten percent of what they were worth. The stock market felt this would be a good way to sell more shares. When the federal reserve told the banks they wanted the money owed them for the new currency they bought, the banks had to empty their vaults. At the same time the stocks bought at ten per cent were asked to be paid for in full. Hence the banks had no money to cover what our citizens had in their accounts and the stock market crashed for they took back all stocks which were bought for only ten percent. The federal reserve has been printing money like crazy, all the new style bills. The more they print without a solid economy , the less the dollar is worth. It's almost like their setting us up for failure again.