The shutdown of the state’s battered hospitality industry will cost the Southern Nevada economy an estimated $38.9 billion, the Nevada Resort Association said Friday.
The association urged Nevada’s congressional delegation to move swiftly to assist the Las Vegas Valley, which it said is more dependent on tourism than Detroit is on auto manufacturing, Seattle on aerospace or Nashville on music and entertainment.
In a letter outlining the devastation the state’s economy is facing as a result of cancellations, closures and shutdowns associated with the coronavirus outbreak, association President and CEO Virginia Valentine said the impact of March and April meetings and convention cancellations is already approaching $2 billion in lost economic activity.
“The Nevada Resort Association has engaged an economic research and analysis firm to assess the economic impact of COVID-19 on Nevada. Their analysis has determined that 320,000 employees relying on $1.3 billion in wages and salary payments each month are at immediate risk. These numbers are nearly twice those reported during the Great Recession,” the letter said.
Valentine’s letter also said that assuming the tourism industry is effectively shuttered for 30 to 90 days, about 102,000 jobs will be directly lost, with total job losses of 158,000.
“This is an unprecedented economic situation that will have catastrophic financial ramifications for individuals, families, businesses and state and local budgets across the state,” the letter said. “As you can see, unequivocally, Nevada is being hit hardest by the economic fallout caused by COVID-19, and we respectfully urge Congress to consider providing immediate economic relief and recovery to the lifeblood of Nevada’s economy – the hospitality, tourism and meeting and convention industry and its vast workforce – for the security of Nevada families today and for the future.”
Valentine’s letter said Nevada’s tourism industry is responsible for 40 percent of Nevada’s general fund revenue, supports 450,000 jobs — one in three in the state — $20 billion in wages and salaries annually, $1.8 billion in industry-specific fees and taxes, and $75 billion in annual economic output, or 45 percent of the state’s total.
In addition to the hit on the state’s workers, tax coffers will be impacted.
State and local governments will lose $500 million in hotel room taxes, $380 million in gaming taxes, $73 million in entertainment taxes, $46 million in local payroll taxes, and $19 million in local business taxes.
Valentine said Nevada relies more on tourism than Alaska does on oil, Wyoming does on coal mining or New York City does on the financial sectors.
The letter was sent to Sens. Catherine Cortez Masto and Jackie Rosen, D-Nev., and Reps. Dina Titus, Susie Lee, Steven Horsford, D-Nev., and Mark Amodei, R-Nev.
“Gosh, not sure what there is to say. Unprecedented times,” said Bo Bernhard, executive director of UNLV’s International Gaming Institute, when asked for his reaction to the week’s turmoil and the association’s plea.
The breakdown was calculated by Las Vegas-based Applied Analysis on behalf of the NRA.