Casinos throughout the US closed starting in mid-March in an effort to help slow the spread of the coronavirus. In June, casinos in Las Vegas and around the country started to reopen. There was some pent-up demand in local markets like Arizona, where there were lines with people cheering as they entered casinos for the first time in weeks.
Cities like Las Vegas saw regional demand from California and other nearby states, but it seems as though that excitement has started to slow. While casinos remain open, it’s difficult to generate revenue with limited capacity and amenities. Las Vegas casino-resorts, specifically, have become dependent on nongaming revenue.
Even if tourists from around the world are interested in flying, there’s little to enjoy in Las Vegas besides gaming and dining. Nightclubs are either closed or are open with a new mellow vibe. Additionally, shows and concerts — long-standing pillars of Las Vegas — remain dark. Meanwhile, there are no conventions to draw business travelers to Vegas. Even CES, slated for early January 2021, has announced that it will go virtual.
Casino operators around the country may have been able to furlough or pay employees for a while, but that’s beginning to end. The spread of coronavirus is still impacting the US, and casino operators are feeling the effects.
Las Vegas Sands was the first casino operator based in the US to report its second-quarter earnings, and it wasn’t pretty. Revenue was down 97.1% from the same period last year. That’s just under a $1 billion loss from last year. This shows the worldwide reach of the pain from the coronavirus. Sands operates only The Venetian and The Palazzo in the US. The latter hotel is currently closed during the week due to a lack of demand.
The unemployment situation around the country is still really bad. Layoffs are hitting the casino industry en masse. Regional and national casino operators are finding it difficult to keep staff employed or even on furlough, as the future is still in question. The road to recovery is going to take a while for both casino operators and employees.
National casino layoffs
Casinos around the country have reopened with limited capacity. Atlantic City is currently operating without indoor dining and a 25% capacity on the gaming floor. Casinos in Las Vegas are allowed 50% capacity in restaurants and on the casino floor. However, bars that don’t serve food are also closed.
The hope for casino operators was that the measures to slow the spread of coronavirus wouldn’t last long. It’s been more than a month since casinos reopened, and it doesn’t appear as though the virus is going away anytime soon.
Earlier this year, MGM Resorts furloughed 63,000 employees in Las Vegas and around the country. The company paused on paying these employees with hopes of being back at full capacity soon. The company is now warning employees that these furloughs could become permanent layoffs at the end of August.
Penn National Gaming has also furloughed some employees. Unfortunately, the national casino operator is already starting to lay off some of its staff. The company will lay off 541 workers beginning on Aug. 15 at its Hollywood Casino at Charles Town, WV, property. The company may do the same at more of its properties in at least Joliet, IL; Pittsburgh, PA; and Las Vegas.
Boyd Gaming expects to lay off about 25% of its 24,000 employees across the country. At the moment, it appears as though 6,075 Boyd Gaming staff members will lose their jobs.
Local casino layoffs
Not all casino layoffs are coming from big corporations. Motor City Casino in Detroit, MI, remains closed. Without an opening date in sight, the company plans to lay off its 2,000 furloughed employees.
Even the smaller Las Vegas casinos are feeling the impact of coronavirus. Circus Circus is expected to lay off 252 employees permanently in September. The casino has already closed its popular free Circus Midway attraction. Tropicana Las Vegas has also announced that it will lay off 620 employees beginning in October.
Circus Circus’ owner Phil Ruffin hasn’t announced any layoffs at Treasure Island, his other Las Vegas casino.
Wynn Resorts was able to pay its Las Vegas employees during the closure. Unfortunately, time might be running out for some of those employees. Hours at some venues inside the luxury resort are being cut back. Furloughs and layoffs might follow, as the recovery continues to be slow.
Caesars merger will result in layoffs too
Last week, the Caesars Entertainment merger with Eldorado Resorts became official. A major part of this deal is for the company to find ways to lower expenses, reduce costs and streamline operations.
Caesars will look to sell some unused land and casinos to generate revenue while reducing overhead and debt. The company is also consolidating. Members of all four Eldorado Resorts players clubs will become part of Caesars Rewards. This will streamline marketing expenses for the new company.
Most mergers result in reducing the number of employees because there’s often overlap in jobs. The casino operator with more than 50 properties in the US will undoubtedly have redundant staffers. The company is planning to lay off some employees during its transition into “New Caesars.”