MGM Resorts Reducing Quarter of Its US Workforce, 18K Jobs Cut
Posted on: August 28, 2020, 09:30h.
Last updated on: August 31, 2020, 11:55h.
MGM Resorts has informed approximately 18,000 furloughed workers that, effective Monday, they will be permanently terminated. The notice represents about one-fourth of the casino giant’s US workforce.
The Worker Adjustment and Retraining Notification (WARN) Act requires employers to provide employees with a 60-day notification period regarding potential mass layoffs. MGM Resorts, Nevada’s largest employer, filed such warnings in May and June.
With the reopening of Mirage this week, all but one MGM Resorts property on the Las Vegas Strip is back in operation. The lone exception is Park MGM.
Hornbuckle succeeded Jim Murren as the chief executive of MGM Resorts following his former boss’ resignation to head up Nevada Gov. Steve Sisolak’s (D) COVID-19 response task force.
Hornbuckle lost his “acting” CEO tag late last month. The casino company’s board unanimously concluded after conducting a national search that he was the best person for the role. Less than 30 days officially into the job, Hornbuckle is firing one out of every four workers the company employed in the US pre-coronavirus. However, he hopes at some point to bring many of those positions back.
With wages being one of MGM’s greatest overhead expenditures, investors celebrated the loss of jobs. Shares on the New York Stock Exchange jumped seven percent on the news.
MGM Resorts certainly isn’t the only Nevada casino operator with furloughed workers on notice.
Numerous casino employers have filed WARN notices since March, according to the Nevada Department of Employment Training and Rehabilitation (DETR). They include Caesars Entertainment, billionaire Phil Ruffin’s Treasure Island and Circus Circus, Oyo Hotel & Casino, Golden Entertainment, Arizona Charlie’s, Station Casinos, Boyd Gaming, Penn National Gaming, Sahara, The Cosmopolitan, and Wynn Resorts.
The jobs on the line are highly dependent on whether tourism returns to Las Vegas.
The Las Vegas Convention and Visitors Authority (LVCVA) reported yesterday that July visitor volume totaled 1.4 million people, a 55 percent year-over-year drop. Conventions remain on hold, and that’s resulted in a year-to-date decline of more than 2.3 million exhibition attendees descending on Southern Nevada this year, compared with 2019.
Nevada’s unemployment rate stands at 16.4 percent. No state relies more heavily on tourism than Nevada. Per the US Bureau of Economic Analysis, 16 percent of the Silver State’s gross domestic product is produced by tourism. Hawaii is a distant second at 10 percent.
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