Waking Up From Recession, Las Vegas Still Hung Over
LIANE HANSEN, host:
This is WEEKEND EDITION from NPR News. I'm Liane Hansen.
(Soundbite of music)
HANSEN: Last week, I paid my first visit to Las Vegas, Nevada. It reminded me of what writer Somerset Maam said about Monaco: a sunny place for shady people. When the sun goes down and countless neon signs light up the Strip, from my hotel balcony, I could see the fake Eiffel Tower at the Paris Hotel and Casino and the fake Empire State Building at New York, New York. A block away, at Bally's Casino, there's a huge billboard advertising an old-fashioned showgirl extravaganza that's been running for decades, Jubilee.
CHORUS: (Singing) Welcome to Las Vegas, and to our show Jubilee...
HANSEN: At night, a slow-moving snake of brake lights makes its way up the Strip. On the sidewalks, people gawk, take pictures, slurp super-sized daiquiris in novelty cups and try to decide where to go next. Hustlers shuck pieces of paper into pedestrians' hands.
Unidentified Woman: Nightclub passes (Unintelligible). No line, no (unintelligible), free admission. Any club any time.
HANSEN: There is no shortage of ways a visitor can spend money here. Gambling is a big industry, and everywhere you go, from the fancy hotels to the gas stations, you hear this:
(Soundbite of slot machine)
HANSEN: But for many Las Vegas residents, it's been a different story. Since the recession hit nearly three years ago, some of them have fallen on tough times.
Unidentified Woman #2: E-200.
HANSEN: At the unemployment office, a staffer calls out ticket numbers for Las Vegans who hope to find work in a metropolitan area where the unemployment rate has reached 15 percent, the highest in the country. The area also leads the nation in foreclosure rates.
Construction has come to a standstill on several mega-properties on the Strip -the Fontainebleau Las Vegas Resort, the Echelon Hotel, the Plaza Las Vegas. Empty lots stand now where some older hotels and casinos were demolished.
The picture used to be different.
Mr. JEREMY AGUERO (Principal Analyst, Applied Analysis): It was sort of a common joke that the state bird or the county bird, the city bird, for Las Vegas was the building crane, a landscape littered with high-rise development and projects going up.
HANSEN: That's Jeremy Aguero, principal analyst with Applied Analysis, a Nevada-based urban economic research firm.
Mr. AGUERO: You go back to 2006 and 2007 and the risks were that we couldn't find enough people to work in all of the hotels and casinos that we were constructing. The concerns were that we wouldn't have enough affordable housing for the workforce. You know, that contrasts incredibly sharply with what we see today: half-built stalled structures along the Las Vegas Strip and in our suburban areas, you know, are certainly monuments to an expectation that was there that never materialized.
HANSEN: Is there any new construction going on?
Mr. AGUERO: Well, very little. I mean, the new construction that we're seeing is largely associated with government-related projects. Certainly, we have some transportation projects going on, city of Las Vegas is working to develop a new City Hall, we've got a performing arts center in the downtown Las Vegas area. And certainly there are some major projects that are finishing up construction: things like the Cosmopolitan Hotel and Casino - a multibillion-dollar project -is out there.
You know, those stand, of course, in stark contrast to all of the major construction projects that are half-finished today, both along the Las Vegas Strip and what have been for a very long time, very affluent suburban areas.
HANSEN: Analyst Jeremy Aguero says Las Vegas didn't necessarily go wrong. Economic cycles happen and the city got caught up disproportionately. In the boom times before the recession, Vegas led the nation in population growth, employment growth, income growth, but that led to over-investment and overbuilding, he says.
On his company's website, a ticker scrolls the latest stats. Red or green arrows point up or down on figures for home sales, hotel occupancy rates, visitor volume, gaming revenue. I asked Aguero what people are looking for.
Mr. AGUERO: I think everyone's sort of looking for that sign that we've hit the bottom, right? That they can be comfortable that while the housing prices aren't going to continue to decline, that they can feel like I'm secure in my job, that the nation as a whole is heading in the right direction, that they can feel somewhat more confident about the community. I don't know that people are looking for one indicator to flip from one side of a ledger to another side of a ledger or have a chart sort of show it be a little bit differently.
But what they're looking for is that sort of consistent sign or that comfort level, almost the psychology to it all that the worst is behind us. And I think that there's a growing momentum that some of that's there, but that is met with a healthy dose of skepticism, just given how difficult this recession really has been on a community that's just not accustomed to that type of economic downturn.