MGM Resorts International is laying off workers at Mandalay Bay because of the economic effects of the Oct. 1 shooting, an MGM spokesperson said Sunday.
“It has been a long-standing practice that many properties in Las Vegas make adjustments in staffing levels in the fourth quarter to reflect business levels,” wrote Alan M. Feldman, MGM’s Executive Vice President of Global Industry Affairs, in an email.
“We have disclosed publicly that occupancy this year at Mandalay Bay will be slightly lower than normal. We are trying to handle this with the least possible interruption to our employee’s schedules, but in some cases, reduced schedules may not be sufficient. We are striving to impact as few employees as possible.”
"Several hundred out of 7,400 employees are being affected,” said Debra DeShong, the company's vice president of global industry affairs.
In a recent conference call with financial analysts to discuss third-quarter earnings, MGM executives, including CEO Jim Murren, disclosed business had suffered in the wake of the tragedy.
During the call, Murren said they saw a spike in non-group cancellations that was exacerbated by the company’s decision to pause marketing programs after the mass shooting.
“Of course, our bookings declined immediately after Oct. 1 because we were suspending our outbound marketing programs and focusing on what mattered — taking care of victims, their families, first responders, our employees and all the guests that are here,” Murren said.
Still, the staff reduction may come as a shock to some because during that same earnings call, Murren said the financial effects of the pause were limited.
“I’m happy to say that these cancellations progressively subsided by mid-October and our booking pace remarkably returned to normalized levels almost immediately thereafter, as soon as we turned on our marketing efforts. Mandalay Bay was the lone exception because we felt it was appropriate to start their marketing later, at a slower pace.”
And Murren said that even with marketing at Mandalay Bay restarting at a slower pace the effects of the tragedy and the marketing pause would be short-lived.
“About half of our cancellations were isolated literally to the month of October,” he said. “We’ve seen bookings improve, our business improve, here in November.”
Some of that discrepancy between Murren’s optimistic statements and the staff reductions may be attributed to seasonal business cycles. Business may have rebounded, but the resort would have had to adjust staffing levels anyway.
“As you know (staffing adjustments) are made seasonally," DeShong said.
A representative for Culinary Union 226, which represents workers at MGM properties (and other casino resorts on the Strip and around Las Vegas) said the union is keeping an eye on the situation.
"Contracts have seniority language which detail that layoffs must be done in a fair and impartial manner and ensures that when business improves, workers will return to work by seniority,” Culinary spokeswoman Bethany Khan said. "The union will be monitoring the situation closely and continue working with affected workers to ensure that the company follows the contract."