Gaming:

Casino giants put numbers on layoffs this year

Culinary says it will offer help to members beginning next week

Saturday, Nov. 1, 2008 | 2 a.m.

Oct. 20 -- Nevada jobless rate at highest level in 23 years
Oct. 8 -- Winning the business of the highest of rollers
Oct. 3 -- As slots get tighter, so do some retirees
Aug. 3 -- Signs are dim, but is Vegas’ future?
Aug. 1 -- Economy cited in Boyd’s decision to postpone further construction of Echelon
July 20 -- Local downturn a hiccup or augur of a bleak future?

Casinos laid off more than 10,000 people after the 9/11 attacks, when half of Las Vegas’ tourism business vanished overnight.

Those layoffs crashed down like a Level 5 hurricane. But this economic downturn has brought smaller, yet persistent waves of layoffs, claiming a few dozen jobs, or a few hundred, with each swipe.

Those numbers are adding up to thousands at a time when many employers aren’t filling jobs vacated by retiring, laid off or departing workers.

The Culinary Union estimates that up to 10 percent of its 55,000 members in Nevada, including casino housekeepers, bussers and cocktail servers, have lost jobs or had their work hours reduced in the downturn.

MGM Mirage, Nevada’s largest employer, has reduced its full-time workforce by more than 1,000 in Nevada over the past year, and Harrah’s Entertainment, the world’s largest gaming company, has laid off about 2,000 workers in the state since January.

Hundreds have lost jobs at other gaming companies around town. And layoffs have accelerated in the past few weeks, the Culinary Union says.

“Workers who are affected are upset and workers who aren’t also are upset for their co-workers,” Culinary Union Secretary-Treasurer D. Taylor said. “I don’t think companies particularly like to do layoffs but with their debt load and obligations” they have to act.

Culinary contracts require that companies eliminate workers with the least seniority first. Laid off workers are added to an on-call list and get first priority for those jobs once business picks up.

The question for casino workers is when that will happen.

“No one can tell us when this is going to end, so we’re preparing for the worst and hoping for the best,” Taylor said.

Starting Nov. 7, the Culinary will gather various agencies in the union’s main hall to assist displaced workers. Workers will be able to file unemployment claims, speak to water, power and gas companies about bill-pay services, receive information about continued health care coverage, speak with housing assistance agencies and sign up for food baskets.

“We want to make sure folks out there aren’t alone in this,” Taylor said.

After first reducing workers’ hours, MGM Mirage and Harrah’s have stepped up layoffs in recent months as business has worsened. They and most other gaming companies are following a broad mandate to cut operating costs in the wake of earnings that have fallen roughly 20 percent or more in recent months.

These layoffs follow previous cuts, many of them corporate-level jobs, to streamline their businesses after mergers that resulted in duplicative systems and departments.

In many cases, full-time jobs are becoming part-time jobs where people are called in as needed. Some employees are working four-day weeks, others a couple of days a week and some aren’t getting called at all.

With business down, the company has “no choice” but to “take costs out of the business,” said Jan Jones, Harrah’s senior vice president of communications and government relations.

Depending on their expenses and business volumes, some departments are reducing costs by as much as 50 percent, others by 20 percent or 30 percent — reductions that include payroll as part of the bigger picture, Jones said.

Pinning down exact figures has been difficult, in part because both companies say such numbers aren’t predetermined. Decisions about how to best cut costs are left up to the executives and managers of individual casinos, they say.

“This is a very fluid thing,” MGM Mirage President and Chief Operating Officer Jim Murren said. “We’ve gone through organizational charts and staffing levels in each department of each property and challenged ourselves to operate these businesses more efficiently and appropriately given the volumes we’re getting.”

Many bosses and the rank and file who still have jobs are facing the same new reality: that they are doing more for the same pay — or perhaps less, if they earn tips. Some of these employees are competing with out-of-work peers for new jobs.

While hourly workers who have lost jobs scramble for work, directors and managers higher up the food chain have some breathing room. In many cases, they are receiving buyouts or severance packages, though such checks may be relatively small for lower-level managers, especially as companies focus on lowering expenses.

Some executives who have recently lost jobs seem confident that they will be able to find work elsewhere in gaming.

“They say they’re taking a long, deserved vacation before starting their search,” said Marc Weiswasser, a senior vice president with CasinoRecruiter.com, an executive search firm in Las Vegas.

Weiswasser has advised his clients to be cautious, and proactive, by taking less-than-ideal jobs that might involve a step down and a pay cut because “it’s easier to get a job when you have a job.”

But many clients refuse because “they think they’re worth more” and believe “this drought can’t last forever,” he said.

This consumer downturn bears little resemblance to that after 9/11, the last significant gaming slump, when many casinos were fully staffed a few months after the attacks. The ripple effect throughout Southern Nevada’s growth sectors, including construction and real estate, has been dramatic.

“We hope that after the election that maybe things calm down” and the economy picks up, Jones said.

“We’re in a turbulent economic storm and our goal is to have the strongest ship possible to ride out the storm,” Murren said. “We clearly have a responsibility to the state, the community and shareholders to be as strong as possible.”

Discussion: 11 comments so far…

By Future2012

11/1/08 at 7:47 a.m.

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The union never worried about the price point that gamers would pay when they got their last big contract.
By neiman1

11/1/08 at 8:56 p.m.

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This drought is going to be a long one. The visitors Nevada depends on are broke as well. No money left after paying for fuel (thank you harry Reid and Nancy Pelosi). No lines of credit from a second on their house to spend like a credit card and fear of how bad it can get if Obama is elected. People are actually saving if they have any money. If taxes are raised on corporate earnings the layoffs will more than double as the employer has to send more to the government. If UNIVERSAL health care becomes a concern, they permanent employees will start disappearing as contract labor is brought in, anything to cut costs. We are in trouble with this election like never before.
By kenodave

11/2/08 at 2:55 a.m.

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Yeah, more jobs will be lost because casino execs will have to protect their bonuses.
By harske

11/2/08 at 8:16 a.m.

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neiman, you make it sound as if people finally saving their money is a bad thing. All that points out is just how precarious Las Vegas' economic model really has been for a while, and things are finally catching up with it.

I agree with you on one point... I too think the local downturn for Vegas will be longer than most think. But as usual, we'll disagree on the politics of it. I don't think Obama will bring about the end of civilization like you do, and I don't think McCain's policies are any better than Obama's. I actually don't think you'll see an appreciable difference with the economy for quite some time no matter which party is sworn in. It's just too broken for anybody to have quick fixes.

But, no matter who wins on Tuesday, one of us will be able to point fingers... and isn't that what politics is all about now?
By JanK

11/2/08 at 10:21 a.m.

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This has been the first year in the last 10 yrs that we didn't come to Vegas. We love your city, but high gas prices kept us close to home. If the gas prices continue to stabalize, we'll se ya next year.

In this country, we really need to take care of ourselves and that means we should produce our own American-drilled fuel. That's the only thing that will keep prices down.
By kloerwald

11/2/08 at 12:35 p.m.

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I cannot believe that Vegas Casino's have turned their back on the middle-aged/ middle-class gamblers that made Vegas what it is today. I am sure this is one of the reasons a lot of the Casino's are struggling, especially on the Strip.

I have 3 adult kids in their 20's and have gone out to Vegas with us at least twice each. They all come back saying it was OK, but way too expensive and doubt they will go back. Eating at the Casino's has gotten outrageous and out of whack with what the average person can afford. Why do they continue to "Up-Scale" their restaurants and hotels to the point of only being able to attract customers that make over $200,000 a year?

I am so tired of seeing on the Travel Channel about Vegas and "The Whales", just how many of those do they think are out there? Vegas was for the middle-class masses, but now all's they want is the young crowd that can barely afford the plane ticket and are living at home in record numbers until they are in their middle 20's because they cannot afford to move out.

Vegas should pay attention. Get back to the basics of Casino adult gambling fun and try promotions that will bring the middle-class/middle-aged customer back and you will see Vegas thrive again.

These are the types of customers that come 2 and 3 times a year and actually "Gamble". The Strip Casino's have all but lost this business, these customers in record numbers are going downtown and to the local Casino's to gamble. I have been coming for over 15 years and have changed to this type of gambler myself.

I use to love Steve Wynn's properties "The Gold Nugget" and "The Mirage", but when we visited his new "Wynn", well" it's obvious he has gotten so rich off of the "Middle-Class" that he has also left us behind. His new Casino was cold and so up-scale that I will never go back. This is a lesson that all the Strip Casino's should realize. The middle-class are the ones who made Vegas, if you turn your back on them, they will turn their back on YOU!
By jfnance32

11/2/08 at 12:53 p.m.

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I think the casino unions are so funny.

They are supporting candidates that want to raise hotel room taxes.

That probably will result in fewer casino jobs.
By nkls3713

11/2/08 at 8:01 p.m.

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Put the blame of the Recession where it belongs with the Bush Administration and the Republican Party.

As a Republican, I am disgusted by the out of control spending habits of the current administration, the horrible choices of the Fed, and the greed of Wall Street. The housing collapse was fueled by the buyers, the lenders, the brokers, the agents, the banks, hedge funds, and the investment banks.

The Republican Party needs to get back to basics which is centered around LESS GOVERNMENT and FISCAL DISCIPLINE. The Republicans need to get away from rhetoric and the extremes of the far right.

The Country right now needs a UNITER not a divider. The smart choice, the right choice is Barack Obama.
By johnevegas

11/3/08 at 4:51 a.m.

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nance: "They are supporting candidates that want to raise hotel room taxes.

That probably will result in fewer casino jobs."

Room taxes in Las Vegas support the LVCVA. The LVCVA's primary job is to bring people to Las Vegas, they call it "Putting heads in beds". These are the people behind all major marketing for travel to our city. Things like "What happens in Vegas..." and such are their work.

The LVCVA not only brings conventions to Las Vegas, they work all over the world to communicate and convey the wonderful things about our incredible city that make people want to come here.

The primary beneficiaries of the work done by the LVCVA are the hotels and casinos, and subsequently, those employed by them. Most visitors don't care about the room tax. They pay a room tax almost everywhere they go. In places like Hawaii, New York, and Las Vegas, room taxes are an essential part of the equation.

The unions would be right to support increased room taxes. Ultimately the increased marketing that comes from it will result in more business and more jobs.
By fremmasmind

11/3/08 at 6:02 a.m.

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Use e-veriy to find the candidates for layoffs. Keep the American citizens working.