Sin City Gripped By U.S Rececession
Cities across the US are slowly recuperating from the recession that still grips the US. Regretably it’s not the case in America’s gambling capital and economists describe it as the worst economic stranglehold in Nevada since the start of casinos in the 1940’s.
Although Las Vegas’ city officials are optimistic that gambling revenues will increase again as the nation’s economy recovers, most economists don’t share the same view. Market experts reckon if the city is to “weather the storm” it will have to dig deep and come up with really groundbreaking innovative solutions especially within the construction industry, since it constitutes the backbone of the city and the state as a whole.
In order to move forward certain key issues have to be addressed first such as the current unemployment rate in the state. As it is the unemployment figure in Nevada stands at 14.4 percent and is the highest in the nation as opposed to the same unemployment figure of 3.8 percent 10 years ago. Presently Las Vegas’ unemployment figure is a disconcerting 14.7 percent.
The prominent Plaza Hotel and Casino is set to retrench 400 of its staff and shut the doors of its hotel and certain sections of its casino for renovation. David G Schwartz present director for gaming and research at Nevada University mentioned that the current economic recession that grips Nevada has been worse before but not near as bad as it currently is. He also stated that the current gaming revenues is in decline and will continue to do so for the next couple of years.
Las Vegas’ Mayor Oscar B. Goodman is rather positive about the future and said there’s still a great influx of tourists flocking to the city although the average room attendance is not as good as it used to be and hotel rooms could be rented at really cheap prices. Unfortunately Las Vegas is always the first and last city in the US to come out an economic recession in the US he added.
Decline in the city’s gambling revenues is indicative that Americans spend less cash on recreational activities such as gambling and travelling. On the flip side, not all is doom and gloom although indicators point out that gambling revenues are down to 2004 levels its busy stabilizing again. Revenues have increased by 3 percent in the first quarter of 2010 and in the second quarter it’s slumped to 5 percent, according to the Center for Gaming Research.
Stephen P. A. Brown, the director of the Centre for Business and Economic Research at the University of Nevada said:”That we’ve hit rock bottom now and market analysts predict that the US economy will recover again, in turn this will impact positively on the nation’s gambling industry”.
The nature of the economic slump is rather disconcerting when a majority of US citizens saw their hard earned retirement cash being eaten away by inflation and their property seriously depreciated. As a result of this economists feel that people are less likely to gamble as freely as the use to, in particular the baby boomers. Despite tourists flocking to Las Vegas in droves, gambling receipts have remained static. Goodman feels that the high cash rollers are not as wealthy as they used to be and they tend to avoid Las Vegas for the time being.
Less gambling revenues are further exacerbated by the US’s current economic malaise. With its prodigious construction programs and daring commercial investments Nevada is paying a very costly price that has left the market saturated and its local economy in disarray.
”Life is getting tougher which is further compounded by the weak US economy and the inability of the Obama administration to find solutions that will mitigate its current economic crisis. We must start thinking out the box if we’re to survive and to rebuild Las Vegas’ economy again,” Mr. Vassiliadis said.