MGM Resorts to lay off 18,000 in slow comeback of coronavirus

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MGM Resorts International is sending pink slips to around 18,000 employees, or more than a quarter of its pre-pandemic US workforce, due to the slow recovery in some casino markets.The cuts, while centered in Las Vegas, are occurring nationwide, the company said on Friday. MGM, the largest casino operator on the Las Vegas Strip, has struggled to fill its halls and casinos since Nevada began reopening in early June. Two of the company’s casinos, Park MGM in Las Vegas and Empire City in New York, remain closed.

“Although we have safely resumed operations at many of our properties and have fired tens of thousands of our colleagues at work, our industry – and our country – continues to be affected by the pandemic and we do not are not back to full operational capacity, ”said Chief Executive Officer Bill Hornbuckle said in a memo to staff.

The company will continue to pay health care benefits until the end of September, and anyone called back to work by December 2021 will retain their seniority, he said. MGM employed around 70,000 full and part-time workers at the end of last year.

MGM shares were already up on Friday, but peaked after the cost cut was announced. The stock climbed 6.4% to $ 24.27 in New York. They were down 31% this year until Thursday’s close.

Visitors to Las Vegas fell 61% to 1.44 million in July, the first full month for Nevada casinos to reopen.

There were also no guests at the convention, according to the Las Vegas Convention and Visitors Authority. Hotel occupancy rates were only 43%, less than half of what they were a year ago.

Rooms at establishments such as MGM Grand by MGM Resorts and Paris by Caesars Entertainment Inc. are available for less than $ 50 a night.

The numbers from Las Vegas highlight the difficulties faced by economies dependent on air travel, with consumers still hesitant to venture far beyond their homes for entertainment.

Casinos whose customers usually arrive by car have strong business because there are so few other entertainment options open. Gaming revenues in Ohio and Mississippi rose in July from a year earlier, bolstering shares of regional casino operators such as Penn National Gaming Inc., which saw its stock fly to nearly 55 $ versus less than $ 5 in mid-March.

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