For the first time since the recession ended in 2009, Las Vegas casino and resort properties are planning on across the board pay raises for both exempt and non-exempt employees. WageWatch surveyed 49 Las Vegas casinos and resorts encompassing over 42,000 employees on and off the Strip last December and early January 2013 to determine the planned hourly and salary pay increases for this year.
Las Vegas casinos on the Strip reported planned wage increases for hourly and non-exempt salaried employees averaging 2.2% and 2.5% for exempt salaried employees. The median was 2.25% for both exempt and non-exempt jobs. Similarly, casinos off the Strip in North Las Vegas, Summerlin and Henderson are planning pay raises slightly less than Strip properties with average pay raises of 1.7% for non-exempt and 1.8% for exempt positions. The median was 2.0% for both non-exempt and exempt positions.
Randy Pullen, President and CEO of WageWatch stated, “We can definitely see that market conditions are beginning to turn positive in Las Vegas.” Average daily rates and occupancies in Las
Vegas remain well below their peaks of $132.09 and 90.4% in 2007, but increased in 2012 for the third year in a row reaching $91.21 and 84.4%. Randy Pullen also stated, “These increases occurred in spite of adding 17,500 new hotel rooms in Las Vegas, a 13.2% increase in the room count since 2008.” The following chart recaps the market performance since 2007 as reported by the Las Vegas Convention and Visitors Authority.
The number of rooms sold in Las Vegas last year reached 46,480,000 in 2012 a new high, exceeding the 2007 peak of 43,979,000. Randy Pullen cautioned, “While the market performance for the Las Vegas lodging segment is looking strong for 2013, leisure and hospitality employment as reported by the Federal Reserve for 2012 in Nevada continues to lag by almost 5% behind the 2007 employment peak.” Unemployment in Las Vegas and Nevada remain high at 10.4% and 10.2%, respectively. Casino and resort management appear to remain cautious, keeping an eye on the slow economic recovery the U.S. is experiencing.
Randy Pullen further cautioned, “While gaming companies are planning on substantial pay raises for 2013, it is likely that actual wage increases that will be reported later this year by WageWatch in its 2013 gaming salary survey will be closer to half those planned. We saw this pattern in 2012 where actual increases came in at less than half those planned.”
Looking ahead to 2013, most leading economists are forecasting continued slow but steady growth of the U.S. economy in the range of 2.0% or better. Expectations are for slow growth the first half of 2013 with possible stronger economic growth the second half of the year. If the economy continues to improve through the second and third quarters of 2013, something it has not managed to do in any of the last three years, Las Vegas casino operators could begin to grow more confident, which would lead to pay raises for casino employees being closer to plan.
WageWatch, Inc. is the leading compensation survey provider for the lodging and gaming industries with 6,000 properties participating in its PeerMark™ Wage survey. WageWatch also conducts compensation surveys for the healthcare, staffing and non-profit industries. The PeerMark™ Wage Survey is the only Web-based custom survey tool that allows individual survey participants to select their competitive set of properties for comparison purposes.