Mounting job losses hit hotel and gambling sectors

NEW YORK - As unemployment climbed to its highest level in 15 years in November, government data released Friday showed that workers at hotels and casino resorts have taken some of the biggest losses.

The accommodation industry lost 36,600 jobs in November, while the amusements, gambling and recreation sector shed 13,100 workers, the Department of Labor said, part of the 533,000 total jobs cut in November that pushed the unemployment rate to 6.7 percent.

The travel and gambling sectors have been particularly hard hit by the recession, as consumers have cut back sharply on discretionary spending.

Some of the most visible layoffs have come from the casino industry, where massive gambling complexes have cut jobs on a larger scale.

In early November, the Borgata Hotel Casino and Spa in Atlantic City laid off 400 workers to cope with the economic downturn. Later in the month, The Little River Casino Resort in Manistee, Mich., cut 100 employees. Also last month, the Mountaineer Casino, Racetrack & Resort in W.Va. cut 93 jobs such as maintenance workers and carpenters.

In some communities, casinos are a major employer. "These complexes employ thousands and thousands of workers," said American Gaming Association President and Chief Executive Frank J. Fahrenkopf. "And those thousands of workers buy cars, buy washing machines. So it's a major negative impact on the communities where we do business when we have to cut back."

Job cuts do not seem to be slowing in December. This week, Black Gaming said it plans to suspend casino operations at the Oasis Resort Casino Golf & Spa in Mesquite, Nev., and lay off 500 workers. Seneca Indian Nation's casinos in Niagara Falls, Buffalo and Salamanca also cut more than 200 jobs this week.

Overall gaming revenue dropped 4.6 percent nationwide in the third quarter as the casinos deal with other problems like tighter credit as they try to build new complexes and a smoking ban in Illinois that has hurt casino business.

Meanwhile, the fourth quarter has been particularly difficult for the hotel industry, as consumers and businesses have cut back even more sharply on travel spending. During October, occupancy for the U.S. hotel industry dropped 6.5 percent compared to the same month a year earlier. On Friday, Fitch Ratings lowered its outlook on three major hotel companies, saying the fourth-quarter declines have dimmed its forecast for the sector.

Fitch cut its outlook on Marriott International Inc., Starwood Hotels & Resorts Worldwide Inc. and Host Hotels & Resorts Inc. to "Negative" from "Stable." The ratings agency said it expects the recession is likely to last well into next year.

Shares of hotel and gaming companies mostly gained Friday. Marriott shares dipped 17 cents to $15.86, while Starwood shares rose 57 cents, or 3.7 percent, to $16.05. Shares of Host Hotels & Resorts Inc. gained 67 cents, or 9.7 percent, to $7.58. MGM Mirage shares gained 50 cents, or 4.9 percent, to $10.68. Shares of Las Vegas Sands Corp. gained 47 cents, or 10 percent, to $5.11.

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