The U.S. is enjoying a tight labor market. But not every company is thriving. Data exclusively compiled by outplacement firm Challenger, Gray & Christmas reveals the most notable job cutbacks in 2019 by companies in the hotel, attractions, airline, and airport sectors.
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:
|MGM Resorts International||2,040||cost-cutting|
|ABM Aviation||2,707||contract loss|
|PrimeFlight Aviation Services (United Airlines contractor)||1,174||contract loss|
|Coney Island and its amusement complex||285||restructuring|
|Bongo’s Cuban Café, Estefan Restaurant Walt Disney World Resort||245||closing|
|Desert Hills of New Mexico||242||no reason given|
|La Torretta Lake Resort & Spa||241||restructuring|
|Doubletree Suites by Hilton Hotel NYC Times Square||215||closing|
|Pier Sixty-Six Hotel & Marina||213||restructuring|
|Clift Royal Sonesta||206||no reason given|
|Villas of Grand Cypress||178||restructuring|
|Monticello Casino & Raceway||160||closing|
|1 Hotel South Beach||139||no reason given|
|Bear Island||132||no reason given|
|Chelsea Park dba The Park||129||closing|
|Southwest Airlines Co.||118||no clear reason|
|Doubletree by Hilton New Bern||115||hurricane Florence|
|SeaWorld Entertainment Inc.||105||restructuring|
|United Airlines (Houston)||100||outsourcing domestic|
|Radisson Suites Hotel Tucson||82||closing|
|Sheraton Clayton Plaza Hotel||82||no clear reason|
|AAR Aircraft Maintenance||80||demand downturn|
|Beachcomber Resort & Villas||79||closing|
|Diamond Resorts, The Modern Honolulu||57||restructuring|
|Sodexo American Airlines Admirals Club||69||contract loss|
|Twin Rivers Casino||65||competition|
|Westin Sheraton Vacation Services||62||no reason given|
|Crowne Plaza Hotels & Resorts||61||closing|
|Holiday Inn San Antonio Airport, Interstate Management||61||closing|
|Delaware North Companies Travel Hospitality Service||60||closing|
|Lamplight Inn of Fort Myers||56||no reason given|
|La Loggia LLC, Tarry Lodge||50||closing|
|Airport Management Service LLC||50||no reason given|
|Eastern Airlines LLC||50||no reason given|
|Menzies Aviation||50||no reason given|
|Southern Airways Mokulele Airlines||24||acquisition/merger|
|Quin Central Park Hotel||18||restructuring|
|Allegheny County Airport Authority||16||cost-cutting|
|Library Bar at the Hudson Hotel||10||closing|
|Mauna Kea Summit Adventures||9||government regulations|
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.
What Does the Future of Lodging Look Like?
Get the latest news about hotels and short-term rentals delivered to your inbox once a week.
Photo credit: A view of the Bellagio hotel and resort in Las Vegas that's owned by MGM Resorts International. The largest job cuts of 2019 by a U.S. travel company came from MGM Resorts, according to data that Challenger, Gray & Christmas. MGM Resorts