‘You Have to Work Extra to Hire People’: What Companies Have Been Saying About Jobs


During recent discussions around quarterly earnings, companies have been addressing the topics of hiring, wages, and workforce size. Some companies have mentioned that they are not expanding their payrolls as rapidly as before, while others expressed concerns about rising wages impacting their profitability. Despite their desire to hire, many companies are finding it difficult to attract and retain workers due to the robust labor market. This sentiment was echoed by Southwest Airlines' COO, Andrew Watterson, who emphasized the need to work harder to hire and retain employees. Labor shortages were also highlighted by Martine Ferland, the head of the consultancy firm Mercer.

Although the rate of workers quitting their jobs decreased in June, indicating less confidence and bargaining power among workers, Rick Cardenas, CEO of Darden Restaurants, noted that the decrease also meant that fewer people were being hired. Wage growth has cooled off in recent months but still remains strong, with a 4.4 percent increase compared to the previous year. Andre Schulten, the finance chief at Procter & Gamble, mentioned that the company continues to face above-normal levels of wage and benefit cost inflation.

Exxon Mobil's CFO, Kathryn A. Mikells, stated that while the company has seen lower prices for materials like chemicals and sand, labor costs have not yet shown deflationary pressure. Roku's CEO, Anthony Wood, indicated that the company plans to continue hiring but outside of the United States, where labor costs are comparatively lower than in Silicon Valley.

In the tech industry, some companies have become more mindful of their hiring practices, with some freezing payrolls or cutting jobs. Meta (formerly Facebook), for example, underwent multiple rounds of layoffs, resulting in significant job reductions. Mark Zuckerberg mentioned that the company's newly budgeted headcount growth would be relatively low. Similarly, Alphabet's CEO, Sundar Pichai, announced the tech giant's intention to slow expense growth and the pace of hiring.   

Pedro Alvarez, a former room service worker at the Tropicana Las Vegas, experienced a significant change in his career due to the coronavirus pandemic. Before the pandemic, Pedro had enjoyed a stable and lucrative job, delivering fine dining to guests along the Strip. However, when the Strip shut down for over two months, Pedro, like many hospitality workers in Nevada, lost his job. Even after the hotel reopened, he was informed that room service would be discontinued temporarily. Since then, Pedro has struggled to find full-time work, having to take on various jobs in concessions and banquets.

Nevada's recovery from the pandemic has been slower compared to the rest of the United States. While the national economy has rebounded and unemployment rates have decreased, Nevada, being heavily reliant on gambling, tourism, and hospitality, has faced challenges. The state has consistently had the highest unemployment rate in the country for the past year, currently standing at 5.4 percent compared to the national rate of 3.6 percent. In Las Vegas, the unemployment rate is around 6 percent.

Due to Nevada's lack of economic diversity, with its heavy dependence on the tourism and hospitality sector, the state was hit particularly hard by the shutdowns on the Strip. In April 2020, Nevada's unemployment rate reached a staggering 30 percent. Although there has been significant improvement since then, with a 4 percent increase in employment over the past year (one of the highest rates in the country), Nevada still faces greater challenges than other states.

David Schmidt, the chief economist for the Nevada Department of Employment, Training, and Rehabilitation, describes this situation as a paradox. Despite rapid job gains, Nevada continues to have a higher unemployment rate compared to other states. This reliance on a single industry raises concerns among elected officials about the lack of economic diversity and the potential impact on the state during a nationwide recession.   

Nearly a quarter of jobs in Nevada are in leisure and hospitality, and international travel to Las Vegas is down by about 40 percent since 2019, including drops in visits from China, where the economy is slowing, and the United Kingdom, according to an estimate from the Las Vegas Convention and Visitors Authority.

The pandemic has had a significant impact on the hospitality industry in Las Vegas, with union officials reporting a 20 percent decrease in the number of workers compared to pre-pandemic levels. Governor Joe Lombardo acknowledged the high unemployment rate in the state, recognizing the ongoing recovery process for businesses and the workforce after the challenges of the pandemic.

To address Nevada's employment and workforce challenges, Governor Lombardo emphasizes the importance of diversifying the economy and investing in workforce development and training. He believes that the long-term economic solution lies in these strategies. Nevada has made progress towards diversification goals, including Elon Musk's announcement that Tesla will invest $3.6 billion in the Gigafactory near Reno, creating 3,000 jobs. Additionally, the relocation of the Oakland Athletics to Las Vegas and the construction of a stadium adjacent to the Strip is expected to generate around 14,000 construction jobs. Events like the Las Vegas Grand Prix and the Super Bowl in 2024 are also anticipated to draw significant crowds and contribute to economic recovery.

Despite the state's unemployment rate, the positive trend in the economy, both locally and nationally, is seen as a favorable factor for President Biden's chances in Nevada during the 2024 campaign. Dan Lee, a political science professor at the University of Nevada, Las Vegas, suggests that if the economy continues on the right track, it will benefit the incumbent.

However, a potential complication arises with the Culinary Workers Union Local 226, representing 60,000 hotel workers, engaging in contract talks since April. The union, which has 10,000 members still unemployed due to the pandemic, is considering a strike authorization vote this fall to pressure major hotels, including MGM Resorts International and Caesars Entertainment, to provide pay raises and reinstate more full-time jobs. The culinary union played a crucial role in President Biden's win in Nevada in 2020, and its members could be difficult to mobilize if the economic climate remains uncertain.

Ted Pappageorge, the head of the Culinary Workers Union Local 226, highlights that companies initially laid off workers during the pandemic but are now making record profits without adequately rehiring staff. The workload issues are impacting all departments within the industry.   

Juanita Miles has faced challenges in securing a stable full-time job. For several years, she worked as a security guard, taking up various gigs at hotels and restaurants. However, when the pandemic hit and businesses closed, she realized she needed to make a career shift. Juanita began searching for employment opportunities in any field.

In late 2020, she managed to secure a part-time dishwasher position at the Wynn Las Vegas, earning $19 per hour. Unfortunately, the hotel downsized its staff, leading to her job loss. Temporarily, she returned to working as a security guard at hotel pools, nightclubs, and apartment complexes. However, Juanita's sense of safety diminished during her night shifts. She experienced a frightening incident where a man, seemingly under the influence of drugs, followed her onto her bus after a shift, prompting her to prioritize her personal safety.

During a break from the scorching 110-degree heat outside, Juanita shared her recent job interview experience at a nearby Walgreens. She felt positive about the interview and hoped to secure the position. The $15 per hour wage would help cover her monthly expenses, including her $1,400 rent, cellphone bill of $103, utilities costing around $200, and $300 for groceries. These expenses are shared with her husband, who works at a call center. With the job at Walgreens, Juanita acknowledged that finances would still be tight, but she aspired to eventually find a higher-paying job.

Juanita's ultimate dream is to open a daycare center, a fulfilling career that would allow her to alleviate the burdens faced by many parents. Despite the present challenges, she remains hopeful about the future and the potential for better opportunities to come her way.   

Mr. Alvarez, a dedicated employee of the Tropicana Hotel, is facing an increasingly uncertain future as the hotel is set to be demolished to make way for the new Athletics baseball stadium. Despite the positive trajectory of the city and the state, Mr. Alvarez emphasizes that it is crucial not to leave workers behind during these developments.

After losing his job at the Tropicana, Mr. Alvarez found work at Allegiant Stadium when it opened to fans in the fall of 2020. His role involved setting up food platters in the stadium's suites during football games. However, this part-time work came to an end at the conclusion of the season. Mr. Alvarez found himself piecing together two or sometimes three jobs just to make ends meet.

During the pandemic, Mr. Alvarez faced the fear of potentially losing his home in North Las Vegas, which he had purchased in 2008. The eviction filings in the Las Vegas area increased by 49 percent in April compared to pre-pandemic levels, according to a report from The Eviction Lab at Princeton University. To sustain himself, Mr. Alvarez applied for unemployment benefits and eventually secured part-time employment as a doorman at the Park MGM.

Putting on his gray vest and tie, Mr. Alvarez prepares for his midday shift at the Park MGM. The recent victory of the Vegas Golden Knights in the Stanley Cup finals at the neighboring T-Mobile Arena reminded him of why he had chosen to remain in the industry. Mr. Alvarez finds fulfillment in helping people and bringing joy to their lives, which he believes is an integral part of what makes the city special. He expresses his hope to continue this meaningful work in the future.   

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