MGM Resorts International (NYSE: MGM) has fired 18,000 employees as the coronavirus pandemic continues to inhibit the rebound of the casino industry.
The resort operator warned employees last month they could expect to be fired at the end of August because conditions in the travel and tourism industry hadn't improved. Despite reopening casinos in June, albeit with social distancing in place, gamblers had not returned in sufficient numbers to justify keeping the employees on.
Visits to Las Vegas plunged 61% in July, according to the Las Vegas Convention and Visitors Authority, as air travel has been slashed by the pandemic. Passenger traffic at McCarran International Airport in Las Vegas is down by two-thirds versus last year, according to The Las Vegas Sun, though it is 56% higher than in June.
With all convention events canceled, though, hotel occupancy has plummeted to just 43%, about half the level of last year.
That's not nearly enough tourism to keep casino personnel fully employed, and last month MGM sent employees a notice under the Worker Adjustment and Retraining Notification Act (WARN Act), which requires large employers to notify workers of impending mass layoffs, that they would be let go. Numerous other casinos issued similar warnings.
The Wall Street Journal reported that CEO Bill Hornbuckle sent a letter to MGM employees saying that he still believed the industry would rebound. He said workers who were being fired would keep their benefits through the end of September, and if they were rehired by Dec. 31, 2021, they would retain their seniority and immediately resume benefits.
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