The economy in Las Vegas is taking its toll on land based casino gambling, but there looks to be a turn-around in 2010 according to analysts. Keith Schwer, director of Center for Business and Economic Research at University of Nevada, Las Vegas, has stated that, “this is a severe, lengthy recession. Do I have an answer for how long it’s going to go? No. Nobody does.”
According to Schwer this is the longest economic recession since World War II. The effect of this recession has hit the tourism business and even Las Vegas Casinos.
The recession has led to loss of employees at Las Vegas casino resorts as well as the stopping of construction on future projects leading to unemployment rise. “I have every reason to believe unemployment will rise above 12 percent here in Nevada and 10 percent nationwide,” Schwer said. “We’re going to continue to see job losses in construction and weakness in the hotel industry.”
“Population is no longer a growth engine. More people are moving out than moving in,” he said.
The number of vacancies in the gambling city for residents has increased leaving 34, 389 residential units vacant. “The only way to get rid of excess inventory is drop the price or bulldoze them down,” he said. “Some houses (in California) have been bulldozed. I’m not advocating that here.”
Due to the expanding CityCenter and other hotel casino resort locations, the city asks the question, “Have we overbuilt the high end of our market with respect to our customer base? We’ve changed the sheets. Of course they change the sheets every night, but the quality of the sheets are now 300 thread count,” Schwer said. “We’re offering a high-quality product. The question is have we lost the value-oriented market.”
“Is there any good news? New claims for unemployment insurance have declined and home prices are starting to stabilize. We have not turned the corner, but this could be the beginning of the end of the decline,” Schwer said.
