It is beginning to look like Nevada may take the lead in the creation of ‘green jobs.’  Between President Obama’s tour of the solar plant that powers 25% of Nellis Air Force Base and the Legislature passing SB152 (commonly known as Steven Horsford’s Green Jobs Initiative). 

An article titled Green Jobs Initiative Advances in Nevada spells out where the job creation will be.  The initiative will create over 3,200 jobs in Nevada to perform weatherization, energy retrofit applications and energy audits

We all know that Las Vegas been taking a pretty bad beating over the past 18 months, or probably longer.  First the real estate industry crashed, and then the financial markets.  But it is the global recession that has negatively impacted the gaming industry the most.  Players are just not playing as much, and visitors are not visiting and/or spending as much. 

Without options, gaming has had to reduce the size of its’ workforce.  And the number of Las Vegas jobs that have been lost  is substantial.  According to previously released annual reports, here are some numbers (extracted from this article):

Casino         2007 FTE            2008 FTE         Job Losses
MGM Mirage     54,700                   46,000                   -8,700
Harrah’s               87,000                   80,000                   -8,000
Station Casino   14,500                   13,400                   -1,100
Boyd Gaming     16,900                   16,000                      -900

So, as you can see these four companies laid off close to 20,000 people in 2008 alone.  These numbers do not take into consideration layoffs in 2009 or from some of the smaller properties such as Herbst Gaming, Riviera or the Mesquite casinos who have laid off thousands more. 

It is sad.  We have not seen this level of layoffs since after September 2001. 

And unfortunately, I think what were once considered a RIF (Reduction in Force), will now be considered a RIS – Reduction in Structure.  Every company has learned how to operate more efficiently with less people.  So even as the economy turns around, I do not see all of these positions being filled again.

Las Vegas (NV) – Recruiting Nevada (“RN”) collected the data presented in this press release during the 1st quarter of 2009 from job seekers who visited the www.recruitingnevada.com website. Recruiting Nevada publishes Nevada’s largest network of employment Web sites, thus attracting the largest audience of local and relocating job seekers. Restrepo Consulting Group LLC (“RCG”) analyzed the trends that the data reflect.

The two firms work together to analyze and report on employment trends in Southern Nevada. The work that RN performs is critical to understanding the types of jobs being marketed, the job seekers that are interested in those jobs and our community, what job skills they might be bringing and where they are coming from. RCG’s role is to assess and interpret what the data means for the future economic sustainability of Southern Nevada.

RN collected 2,616 responses during the period. The data contained herein represent selfreported information. Job seekers’ intentions might vary significantly from their actual behavior. The data being analyzed are based on responses to job openings that have been marketed by RN for its clients, not basic inquiries.

Analysis

• There were 2, 616 survey job seekers during the 1st quarter of 2009 vs. 2,729 during Q4. 68.1% or 1,782 of Q1 respondents came from 10 states. Nevada (28.6%), California (12.7%) and Arizona (4.1 %) were the Top 3 states for survey job seekers during the quarter. In Q4, the Top 3 states were Nevada, California and Texas (dropped to the #6 spot in Q1.
• Over 75% of all the respondents from the Top 10 states were from Southwestern states (Nevada, California, Texas, Arizona and Utah), compared to slightly over 72% last quarter. Three of these states, Nevada, California and Arizona, remain at the center of the housing market collapse. Of particular concern is Nevada, because its percent of job seekers data is indicative of large job losses. Nevada had an unemployment rate of 10.4% in March 2009, almost 2 percentage points above the national average of 8.5% that month.

Analysis

• The Top 5 employment categories most heavily marketed, and the ones that job seekers were most interested in included:
  1. Nursing – 38% vs. 32% in Q4, 2008
  2. Construction Trades – 22% vs. 14% in Q4
  3. Mining Trade – 16% vs. 24% in Q4
  4. Instruction – 16% vs. 8% in Q4.
  5. Construction Management – 8% vs. 22% in Q4
• Again, the good news is that the largest segment of job seekers was looking for nursing jobs, a profession that is in very short supply in Nevada. The bad news is that there was drop of 6 points from Q4’s estimate to 30% of the job seekers coming from the Construction (Trades and Management) sector, a very clear indicator of the collapse of development activity in Southern Nevada in Q1.
• Please note that RN is able to define the audience of readers/users by its Search Engine Marketing (SEM). Therefore, the data on employment categories skew towards nursing, because that is where the largest portion of RN’s marketing budget is invested. No dollars, however, were spent marketing construction-related jobs. These are “active” jobseekers who found the www.recruitingnevada.com website.

Analysis

• The data appear to indicate that there was a relatively good supply of well-educated job seekers looking for work in Nevada during Q1, 2009. Added together, job seekers with Bachelors, Master and PhD. degrees comprised 47.6% (vs. 29.4% in Q4) of the persons looking for new employment, in-state and out-of-state. This speaks to weak employment conditions in other states, and the possible view that Nevada has a better upside potential than some other states. What we don’t know is how many are currently employed, underemployed or unemployed in the state.
• 20% (vs. 28% in Q4) of respondents had in Q1 a high school diploma. About 19% had an Associates degree and 9% had a trade school diploma.

Analysis

• Senior level and senior management employees, again, represented the largest share of job seekers at 45%. This group accounted for 42.3% of respondents in Q4, 2008. Mid Level employees and Mid Level Management accounted for 19.4% versus 18.4% in Q4, the second largest group.
• On a positive note, its good for Nevada that mid and senior level employees are interested in possibly relocating to the state. On the down side, the relatively large percentage of Senior and Mid Level job seekers is the result of the continued shedding of jobs around the country, because of job losses that continue around the country.

Analysis

• When asked about their interest level, 52% (54% – Q4, 2008) of all the job seekers in Q1 said that they would move to Nevada if they could find a job here. Clearly, most respondents do not want to move to Nevada without a job already in hand, because of the severity of the economy in the state.
• Nearly 25% of job seekers indicated that they currently live in Nevada. The share in Q4 was 23%.

Analysis

• The majority of respondents in the Q1 survey, not currently living in Nevada (47%, vs. 49% in Q4), indicated that they would prefer to rent if they move to Nevada, at least initially. Additionally, 34% (Q4 – 40%) said that they would rent first and then buy a home once they move to Nevada. 19% claimed that they would like to buy a house upon relocating to the state. This was 2 points above Q4’s numbers.
• The weak economy is clearly causing job seekers to be very conservative in making longterm and large-scale financial commitments like home purchases. This also continues to be function of the weakness of the economy and housing market in Nevada, and in the job seekers’ state of origin.
• Out of those job seekers who expressed an interest in buying a house once they move to Nevada, 48% (52% in Q4) were senior level or Senior Management employees with over 4 years of experience.

Analysis

• The data show that, regardless of the education level, more than half of all job seekers plan to ultimately buy a home (51% – blue and yellow bars).
• Of the respondents who stated that they intended to buy a home in Nevada if they to the state, over 47% (Q4 – 39%) had a bachelor’s degree or better. Of those who plan to rent if they move here, almost 42% (Q4 – 51%) had a high school diploma, a trade school diploma or no degree.

Workforce shortages are very costly.  They contribute to the largest line item of nearly every P&L (profit & loss) statement – Labor.  Yet, many times we never take the time to understand the true “cost” to the organization.  We focus on filling the positions so we can remain operational, and never take the time to understand the short and long term affects of ignoring the root cause of the shortage. 

If you asked any gaming executive where their greatest turnover is, indisputably the  answer would be “housekeeping.”  And the largest volume of jobs (approximately 20% of all jobs within a hotel/casino ) are in housekeeping.  So when you add up the financial impact of this “churn”, it grows exponentially. 

The “short term” expenses that add up rapidly are both ’soft and ‘hard’ expenses.  They can be grouped into a few categories: pre-departure, coworker burden, selection and sign-on.  Here is a great white paper, titled Calculating the Cost of Employee Turnover, that Recruiting Nevada released several years back when we were tackling Nevada’s nursing shortage.  There is a worksheet on the last page that will help determine what the actual cost of turnover is.  It is a great resource that we have used many times over. 

To share some of our findings from the nursing shortage case study - the cost of replacing a nurse was approximately $77,000 or nearly 1.5 times annual salary.  Some of the area hospitals were experiencing turnover rates above 20%, which is nominal compared to what I have heard GRA turnover is.  So when you take a nursing workforce of several hundred, calculate the annualized turnover and multiply that by the cost-of-replacement, the financial impact quickly creeped into the millions.  And this was for one hospital!  Add up the 14 hospitals we were working with and we were looking at a $100+ million problem.

I suspect the problem is much worse with the GRA shortage.  First off, some properties would love to have a turnover rate as low as 20% (I have heard of some with over 100%).  So for practical purposes, let’s stick with 20%.  Arguably there are more than 12,000 GRA positions in the market.  I think the Culinary Union has over 12,000 GRA members.  And to be conservative, we will use a cost-of-replacement of 1x annual wages.  So here are some very rough numbers:

12,000 x 20% (turnover) = 2,400
2,400 x $27,000 (estimate 1 yr. wages) = $64.8 million

$64.8 million is a big number.  So using very, very conservative numbers – this is clearly a huge problem.  If we were to increase the turnover rate to 25%, it would impact the number by an additional $16.2 million (you can see how the number grows exponentially). 

So – that gives us an idea of the ’short-term’ expenses.  And fortunately, these can be corrected by an increased supply chain and improved retention rate, both at the property level and industry level.  Note:  It will require an industry correction to solve the shortage. 

Unfortunately, there have been some long-term costs that can never be reversed.  These long-term expenses typically come by way of increased wages caused by the strain of the workforce shortage and/or the overall damage done to the image of the profession.  In the case of the GRA shortage – probably both.  

It is difficult to measure the financial impact to the image of the profession.  It can be done over time, but initially it cannot.   However, the increased wages can easily be measured…..Taking a look at the 2002 collective bargaining agreement, GRA wages were increased $3.32 per hour over a 5-year period.  Using the same 12k (member) number above, there is an $82.9 million annual impact from these wage increases.

So cumulatively, it is nearly a $200 million annual problem for the gaming industry.  That’s a lot of money…money I bet the gaming industry would love to have back in their pockets right now, all things considered. 

Personal note:  Thank you to all that have been confidentially commenting on this series and providing me with real ‘intelligence’ on the problem.  Together, we will solve this workforce shortage and keep Las Vegas the premier vacation destination. 

I was fortunate to attend the Kennedy Recruiting Conference last week.  I always enjoy attending the conference because the audience is primarily made up of corporate recruiters (This year more than most due to the economy).  This allows us to just sit back and listen to what our clients want, rather than try and develop something that we think they need. A novel idea that very few follow. 

One of the best presentations was on corporate career centers – and what works best.  Microsoft has mastered the development of micro-sites for the purpose of targeting specific demographics.  Here are just a few of their micro sites.  You can click on each image and it will take you to the actual micro site:

All are very interactive and engaging.  All are great examples of how to add ’sexiness’ to a career center.

Nevada’s seasonally adjusted unemployment rate increased to 10.6 percent, gaining two–tenths of a percentage point over-the-month.  It’s the smallest month-to-month increase since April 2008, according to Bill Anderson, chief economist for the Nevada Department of Employment, Training, and Rehabilitation.
  
The number of unemployed Nevadans fell for the first time in a year, falling by one-hundred to 146,300. The unemployment rate is 0.1 percentage points below the record of 10.7 percent (December 1983.)  “The decline may be an indication that the worst of the down turn is behind us, but only time will tell if April’s reading is the start of a trend or just a brief respite from continued increases in unemployment,” Anderson said. 

Nevada’s unemployment rate remained higher than the national average, which was 8.9 percent in April.  

The unemployment rate in each of Nevada’s three metropolitan statistical areas either declined or remained the same.  The Carson City MSA experienced the sharpest decline in its unemployment rate, falling from 11.3 percent to 10.8 percent.  The unemployment rate in Reno-Sparks fell two-tenths of a percentage point to 11.0 percent, and the Las Vegas-Paradise unemployment rate was unchanged at 10.4 percent.  (Unemployment rates for the State’s metropolitan areas are not adjusted for seasonality.  For comparison purposes, the State’s unadjusted unemployment rate was 10.5 percent in April.)

“Employers reported 5,200 fewer jobs Statewide in April than in March, an about-face compared to last year’s increase of 5,100 over the same period.  The recession has negated typical seasonal growth seen this time of year.  Over the last five years, Nevada’s employment increased an average of 11,320 from March to April,” Anderson said. “A number of key industries failed to maintain employment levels: the retail sales industry shed 1,600 jobs; professional and business services employers trimmed 1,400 jobs from their payrolls; and local governments, struggling with declining revenue, slashed 1,500 jobs over the month.   On the bright side, food service and drinking establishments added
1,100 positions, education and health services added 100, and casino hotels and gaming ended a string of monthly losses, remaining flat over-the-month.”

Employment trends in Nevada’s three metropolitan statistical areas were mixed.     Employment in Las Vegas declined 4,200 over-the-month and is down 54,700 over-the-year. Reno-Sparks employment contracted by 700 jobs from March to April and is down 18,500 over-the-year.  Carson City managed a monthly increase of 200, but is down 1,300 from the same month a year ago. 

The CBER-DETR Nevada Coincident and Leading Employment Indices, developed through a partnership between DETR and UNLV’s Center for Business and Economic Research, measure the ups and downs of Nevada’s economy. There are two indices: the Coincident index, which gauges current labor market conditions, and the Leading index, which signals the future direction of the Coincident index.  The Coincident index uses four employment measures: household employment, nonfarm employment, the unemployment rate and the insured unemployment rate.  The Coincident index fell by 3.4 percent in March from February, suggesting the current recession has yet to find a bottom. The Leading index, however, showed an increase from February to March of 0.1 percent, implying that an employment bottom may be near.

According to Anderson, a comparative review of Nevada employment changes over time offers a sobering analysis of recent trends, Anderson said.  On a percentage basis, the level of job losses in the current recession has not been seen since World War II.  The Nevada economy in the 1940s was significantly different than today’s.  At the time, Nevada’s total employment was less than 60,000.  From 1943 to 1944, the economy shed 6,900 jobs, accounting for a 12.4 percent year-over-year decline. 

“Even the recession of the early 1980s is beginning to look relatively mild as the current recession deepens,” Anderson said. “In 1982, Nevada lost 2.4 percent of all jobs.  Through the first four months of 2009, Nevada has already lost 5.7 percent of all jobs, with more losses expected as the year unfolds.”

Nevada’s construction industry continues to struggle through commercial and residential market adjustments.  Employment in April declined by 1,200 over-the-month, and is down 22,600 over-the-year. 

“Nevada’s construction woes are not unique to the State, though the build up and fall of the industry has been more severe than most,” Anderson said. “During the peak of the ‘housing boom’, year-over-year employment growth neared 18 percent in Nevada.  Compare that to the 5.2 percent employment growth in the nation as a whole over the same time period.  At its height, the construction industry accounted for 11.2 percent of all jobs in the State, and only 5.7 percent for the nation.  Through 2009, the ratio of construction jobs has fallen to 8.1 percent of all jobs in Nevada, a level similar to the early 1990s.”

Growth in Nevada’s construction industry began to slow a year before the U.S., though both started contracting in 2007.  Nevada began contracting at a much faster 6.4 percent, compared to just 0.8 percent at the national level.  Through the first four months of 2009, that gap has narrowed, and the rate of decline has also been similar, as Nevada has contracted 16.5 percent, and the nation 14.2 percent. 

“Nevada’s construction woes will likely continue through the rest of the year, as the City Center and Fontainebleau projects complete construction,” Anderson said. “With each project nearing completion, both operations will release workers throughout the summer and into the fall.  Once released, workers will find it difficult to locate new employment opportunities.”

Anderson added that the financial troubles of the big-three automobile manufacturers are adversely affecting both national and local economies.  Restructuring efforts include planned dealership closings in Nevada.    The closures will cause additional hardship for an already battered industry in the State.  New auto dealerships have already shed over 550 jobs falling to 9,591 through the third quarter of 2008 (the most recent data available.)  Recently announced dealership closures will significantly increase the level of job losses in the months ahead.

We all enjoy a little competition.  On Tuesday, our Opportunity Boulevard Career Fair was able to compete head-to-head with the Las Vegas Review Journal Job Fair.   By all indications, Opportunity Boulevard was the winner in this battle.  A few ’spies’ were able to visit the RJ’s event and reported back that attendance was ‘beyond’ light and employers were so disappointed that all but three of them broke down their booths an hour before the job fair was scheduled to end.

Of course we celebrated.  But unfortunately there was another loser in this competition…..the jobseeker.  And at the end of the day, that is why we are in business – “to serve the jobseeker.”  If we lose their trust or confidence, they do not come back.  And if they do not return, we are not able to serve our other customer (the one that pays us), the employer.

Well, on Tuesday there were surely some upset jobseekers that attended both events looking for a room full of employers who had jobs to offer during these disparaging times.  Yes, those that attended the Opportunity Boulevard Career Fair were able to see more employers and had access to well over 14,000 jobs in Las Vegas.  But, there were a few employers that chose to attend the RJ job fair rather than ours.  And those employers were also offering real jobs that jobseekers were looking for.  Maybe only a few hundred jobs…but nonetheless, jobs that are so desperately needed right now. 

And the other jobseekers, those that attended the RJ job fair only to find a few employers offering real jobs, mixed in with vendors looking to sell products (including the RJ selling video resumes) and non-employment offerings, went home to their families and friends and shared their anger.  And now (to them), ‘job fairs are a waste of time.’  Unfortunately, they do not differentiate between the two promoters because they do not know different.  This negativity surely does not help the industry, nor the economy.  We all need to get these jobseekers back to work.  We all benefit from it. 

I don’t like seeing unhappy, or discouraged, jobseekers.  Although I truly enjoyed beating the RJ, I wish we could have avoided the competition for the sake of the jobseekers.  For they were the unfortunate losers in this battle.  They went home without jobs.

The Recruiting Nevada Network of employment websites is pleased to welcome our newest partner – Vegas.com.  Vegas.com is the leading travel website representing the Las Vegas marketplace.  Recruiting Nevada continues to grow its network.  Over the past 12 months, we have increased our monthly pages views from 400,000 to over 1.2 million, delivering our clients the most cost effective recruitment advertising solutions available.  Check out the new site:

For some reason the Guest Room Attendant (GRA) has been branded as a ‘back-of-the-house, non-tipping position.’  This is absolutely incorrect. 

First off, the GRA is far from ‘back-of-the-house.’ 

The GRA is a front line employee who interacts with hotel guests each and every day whether management wants to accept it or not.  The fact of the matter is – it happens.  And many times, GRAs interact with guests more than the beloved concierges do.  Why?  Because they are easily accessible and perceived by the guest to be ‘unbiased.’  The GRA is often the first hotel employee a guest sees in the morning and the simple question of “Where is a good place to grab a quick breakfast,” or “How do I get to your (fill in the blank) restaurant?” are answered.  I would call this front-line. 

Secondly, GRAs are tip earners. 

Yeah – they do not earn as much as a cocktail waitress, bartender or valet, but they do earn tips.  Pretty much everyone I know tips their GRA a few bucks each night or leave the loose change from their fun-filled night of gambling on the nightstand as a way of showing appreciation for keeping their room in order.  I am sure the tip volume varies from property to property and even city to city.  But GRAs do make tips. 

So why have we branded the GRA position as a back-of-the-house, non-tipping position?  I don’t get it.  This very well may be the fundamental problem that led to the stereotyping of GRA jobs being for Mexican women.  If the average Joe (or Josephine) knew that they could contribute to the overall guest experience and earn additional income (tips) by doing so, the GRA position would be a much more appealing job.  More applicants would apply and we would not have the critical shortages that we have in this profession. 

Recruiting Nevada’s goal is to help change this.  We feel that we can:

• Get the GRA recognized as a front-line employee who positively contributes to the overall guest experience
• Reverse the current recruiting pattern and attract a cross-section of highly motivated workers
• Correct the critical workforce shortage that has plagued the hospitality industry for many years
• Decrease unnecessary turnover caused by the cannibalization of each others talent
• Improve retention levels and overall productivity levels
• Add profitability to the bottom line through continuity

Again, this is an open case study that we will be sharing with our readers as we make the journey.  Thank you for all of  the feedback from last week’s post.  We will figure this out together. 

This is Part 3 of a series on the Housekeeping shortage.

Incidents of workplace violence are on the rise fueled by the difficult economic climate.  You are invited to attend a FREE seminar:

When:  June 2, 2009, 7:00-8:45 or 9:00-10:45
Where:  Las Vegas Chamber of Commerce, 6671 S. Las Vegas Blvd.
To RSVP please contact Jason Porter at: Jason.Porter@ci-pinkerton.com or call: 702-691-3326

This in-depth seminar on workplace violence will address the current deadly trends emerging in today’s difficult world and the methods, techniques, and technologies that can help to limit your company’s exposure to the liability.

This free seminar will give you the information and tools to help protect yourself, your employees and your company.

There will be two sessions to choose from both will have 15 minutes for networking & provided continental breakfast and the presentation will last approximately 90 minutes.

When you RSVP please indicate which session you want to attend.  To RSVP please contact Jason Porter at: Jason.Porter@ci-pinkerton.com or call: 702-691-3326

About the presenter:

Robert L. Dodge CPP, VP West Region Pinkerton C&I
Mr. Dodge has been involved in security, investigations and security consulting for nearly 18 years. His experience includes stints with a large Multinational High Tech Corporation as a Corporate Investigator. He has worked for contract investigation firms providing investigation and security consulting services on a global level to corporate clientele.

His security experience includes working with American Protective Service, and the Securitas Group. In his current role as VP Western States he is responsible for managing Pinkerton’s operations for the Western US and client needs globally. He has conducted and managed numerous Workplace Violence investigations and security details for Workplace Violence threats. He has operated on security & investigative projects in more than 50 countries around the world. He has special expertise in corporate investigations and risk/vulnerability/threat assessments.