MGM Resorts Leads U.S. Travel Sector With Job Cuts So Far in 2019

The U.S. travel industry continues to see an overall tight job market, benefiting from a strong economy that drove the unemployment rate to a half-century low, the U.S. Bureau of Labor Statistics reported Friday. But some individual travel companies experienced job cuts tied to retrenchment this year, providing a humbling context to Friday’s jobs report.

The year’s most extensive job cuts by a U.S. hotel company took place at MGM Resorts International, according to data tallied for Skift by Challenger, Gray & Christmas, an outplacement and career-transitions company.

The Las Vegas-based MGM Resorts International trimmed 2,040 positions through September 2019, according to the data. In January, the casino and hotel operator began to cut costs in an effort that would trim about $150 million a year over two years in labor cutbacks.

In the aviation sector, the largest job loss came at ABM Aviation, a subsidiary of publicly held facility management company ABM Industries. A few airlines dropped their service contracts with the company, switching vendors either in-house or to other providers.

ABM lost a contract with Delta Airlines, costing AMB 1,121 positions in Atlanta this year. It lost a contract with American Airlines that cost it about 600 jobs in Dallas, and lost a contract with United Airlines and had to cut 735 jobs in Chicago. It lost some other deals for cleaning planes, helping transport passengers in wheelchairs through the airport, and other services this year as well, for a total loss of more than 2,700 positions.

PrimeFlight Aviation Services, a similar facility service provider, lost a United Airlines contract that led to 1,174 job losses this year.

Please see this table for other notable job losses in the traveler accommodations, and airline and commercial passenger aviation sectors:

Source: Challenger, Gray & Christmas

A strong economy has benefited U.S. hotels in strong guest bookings but has run up operational costs on the labor front due to labor shortages in some markets. But that pressure may be easing.

Hourly earnings in the hospitality segment representing hotels, motels, and inns of 50 or fewer people was $16.12 an hour in September, according to data pulled for Skift by Paychex, a payroll services firm.

That represented hourly earnings growth of 2.22 percent over the past 12 months in the traveler accommodation sector, which was slightly weaker than the 2.77 percent national rate. A decline of 1 percent in year-over-year weekly hours worked pulled down the earnings growth, Paychex said.

As for Friday’s federal jobs report, the leisure and hospitality sector grew by a seasonally adjusted 21,000 jobs in September, to 16.72 million.