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Arnold M. Knightly


Harrah's responds to slowdown with labor reductions

18 Feb 2008

By Arnold M. Knightly

LAS VEGAS, Nevada -- Harrah's Entertainment has laid off workers and reduced hours at many of its properties around the country, citing the slowing economy, the company confirmed Friday.

The current round of layoffs includes nearly 100 workers at its eight local properties, 30 workers in Illinois and smaller numbers at its properties throughout the country.

"It depends on the property; it depends on how business is there," Harrah's Entertainment spokesman Gary Thompson said. "Hopefully, we'll be able to get those people back as soon as possible."

The gaming giant owns the Rio, Paris Las Vegas, Bally's, Bill's, Flamingo, Imperial Palace, Harrah's and Caesars Palace in Las Vegas.

Harrah's owns four properties in Northern Nevada, one in Laughlin, and 20 more in eight states outside Nevada. It also manages three American Indian casinos around the country.

"If business continues to be less than optimal in some regions, we're going to have to adjust our costs there," Thompson said.

Harrah's confirmation follows similar reports by Station Casinos and MGM Mirage that the economic downturn is causing layoffs, work-hour reductions and hiring freezes of a few positions.

Both Harrah's and Station Casinos said the labor-cost reductions are not related to the recent buyouts of their companies by private-equity companies.

The economic slowdown in gaming comes as consumer confidence ebbs because of the local housing crisis, said Brian Gordon, a principal at Applied Analysis, a Las Vegas financial consulting firm.

"The soft economic conditions are impacting all business sectors and all geographies," Gordon said. "The Las Vegas gaming sector is feeling the downswing in the overall economy and is responding accordingly."

Boyd Gaming Corp., which owns nine casinos in Clark County and a few more in five states, declined to say if the company was making any labor adjustments, citing that it is a publicly traded company.

"There is no question these are tough times," Boyd spokesman Rob Stillwell said. "We manage our business very closely. We are always working to keep expenses in line with business levels, and today is no different than previous times."

A worker at one of the company's properties said Friday that "vacation relief and on-call people are dying for something to do" because of a slowdown in business.

The worker, who asked that his name be withheld because he still works for the company, said he was told that certain positions in his department are not getting filled for now when someone leaves.

The economic slowdown also is affecting staffing concerns at some individually owned properties around the valley.

Silverton General Manager Yale Rowe said the property has "adjusted our staffing levels" similar to what has been reported with other companies.

"From time to time we have to make adjustments that fit business volumes, and this is one of those scenarios," Rowe said.

The labor reductions follow an announcement in July that the Silverton was delaying plans to build a new 360-room hotel tower because of the tightening credit markets.

However, construction continues on the first phase of a $500 million project that will include a casino expansion, new pool and parking garage.

Planet Hollywood Resort officials called the recent layoff of 68 workers a staffing correction following the property's grand opening in November.

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