Hotel Industry on ‘Brink of Collapse,’ Resorts Warn More Layoffs Without Federal Relief

Posted on: September 22, 2020, 01:56h. 

Last updated on: September 22, 2020, 02:50h.

Devin O'Connor @CasinoorgDevinO Read More
Expertise: Asia Pacific Gaming, Commercial Gaming, Legislation, Politics.

The American Hotel and Lodging Association (AHLA), the industry’s leading trade association and lobbying voice in DC, is warning Congress that more than two out of three (67 percent) of US hotels can’t last another six months without federal assistance.

hotel industry Las Vegas Nevada casino
Nearly all tribal and commercial casino resorts closed in 2020 because of the coronavirus. While most have since reopened, the Palms, seen here, being one exception, the hotel industry is warning Congress widespread permanent closures could be on the way. (Image: Las Vegas Review-Journal)

A survey conducted by the AHLA of its members reveals that 74 percent of hotels will be forced to lay off additional employees if they don’t soon receive access to government funding. Sixty-eight percent of hoteliers say their workforce is less than half of its pre-COVID-19 payroll. Roughly 50 percent of hotel owners say they’re in danger of being foreclosed on by their commercial real estate lender.

These are real numbers, millions of jobs, and the livelihoods of people who have built their small business for decades, just withering away because Congress has done nothing,” said AHLA President Chip Rogers.

“We can’t afford to let thousands of small businesses die and all of the jobs associated with them be lost for many years,” Rogers continued.

The AHLA is calling on Congress to provide extensions through the Paycheck Protection Program (PPP) to keep hotel workers employed. The Association is additionally seeking financial relief through the Federal Reserve and Treasury, including limited liability language for hotels, and tax provisions to assist severely impacted hotels and their employees.

Mammouth Hotel Industry

No state relies more on tourism than Nevada. The Silver State’s largest employer is MGM Resorts, which operates nine casinos on the Las Vegas Strip.

The Nevada Hotel and Lodging Association is an AHLA member. The AHLA reports that Nevada has 566 hotel properties, with approximately 194,400 guestrooms. Hotels employed 370,741 people in Nevada last year and generated a gross domestic product of $27 billion. Hotels delivered $4 billion in state and local taxes and $5 billion in federal revenue.

MGM Resorts has permanently laid off 18,000 positions nationwide, including 10,000 in Las Vegas. Other Las Vegas casinos and Nevada-based operators have also cut jobs — Treasure Island, Sahara, M Resort, and Boyd Gaming, to name a few.

Union Calls for Change

The Culinary Workers Union Local 226 and Bartenders Union Local 165, both affiliates of UNITE HERE, collectively represent some 60,000 workers in Las Vegas and Reno. The vast majority of their members are employed by casino hotels in Las Vegas.

The Culinary Union is urging its members, and other Nevadans, to vote for Democratic candidates on November 3. The union says blue candidates are best suited to lead the post-COVID-19 recovery.

In a release issued today, Culinary says it supports Joe Biden for president, and Democratic candidates for Nevada’s four House congressional seats up for election — Dina Titus, Patricia Ackerman, Susie Lee, and Steven Horsford.

“Donald Trump is a threat to the livelihoods of workers and our families,” opined Culinary Union Secretary-Treasurer Geoconda Argüello-Kline.