Las Vegas rebounding from travel slowdown
Associated Press
LAS VEGAS — Las Vegas is making a strong comeback from the economic downturn caused by the tourism slump that followed Sept. 11, an economist says.
Advertiser library photo • Oct. 2, 2001
Sung Won Sohn, chief economic officer for Wells Fargo Co., predicted the net migration of people into Las Vegas will drop to 45,000 this year, compared with 55,000 last year, but he expects it to pick up again in 2003, the Las Vegas Review-Journal reported.
Job seekers crowd the listings posted at a Nevada state employment office. About 15,000 gaming workers were laid off following the Sept. 11 terrorist attacks.
"Before I go into any community, before I look at gaming or housing, I look at population growth," Sohn told business and government leaders attending Tuesday's Las Vegas Perspective 2002 economic forum.
Las Vegas continues to be the fastest-growing major city in the United States, increasing its population by 7 percent annually — about 6,000 people a month.
"Basically, people come here for two reasons: jobs and quality of life," Sohn said. "Gaming jobs have declined, but that was offset by other jobs from the retail industry and construction and manufacturing."
About 15,000 gambling industry workers were laid off in Las Vegas after the terrorist attacks because of the dramatic drop in tourism. By February, the city's employment base was down by about 6,000 hotel, gambling and recreation jobs, Sohn said.
Sohn pointed to jobs needed to support the area's population growth, including government jobs, school teachers and construction trades.
"When people come here, they need everything: water, sewer, houses, infrastructure," Sohn said. "If we can turn gaming-related jobs around, the economy will do better."
Visitor volume in Las Vegas reached year-ago levels in February — the first month since September's dramatic declines. For the first two months of the year, visitor volume remained down 2.4 percent.
Sohn thinks the number of tourists visiting Las Vegas will continue to increase as consumer confidence and take-home pay — key economic drivers — continue to rise.
"We are already seeing that," he said. "Look at airport passengers. The numbers hit bottom in December and it's been increasing ever since then."
Las Vegas hotels suffered a sharp decline in occupancy levels and were forced to discount rates dramatically immediately after Sept. 11, but that also has turned around, Sohn said.
So far this month, the average revenue made from each hotel room has increased 0.1 percent on weekends. Room revenue, however, remains down 0.3 percent during the week.
"We've made significant progress. I think the worst is over and things are looking up. Tourists are beginning to come back, and again, the most powerful force is the in-migration will begin to accelerate in the second half of this year."
Gambling industry analyst Jason Ader of Bear Stearns Co. has echoed Sohn's outlook saying that the trend is "clearly showing the continued rebound in the Las Vegas market."
