Las Vegas economy, hit by coronavirus pandemic, nears end of federal benefits

  • Coronavirus pandemic effects on the economy see jobs lost and federal unemployment benefits ending
  • March saw the approval of $2 trillion-plus federal Coronavirus Aid, Relief and Economic Security Act
  • Homelessness and lockouts expected with the federal benefits end expected and state’s temporary ban of evictions nearing the end
  • More coronavirus cases are being recorded

Susan Marsian-Bolduc, a 54-year-old Las Vegas tour guide, was furloughed as the now infamous coronavirus pandemic hit the country. She is a proud owner of a 14-foot travel trailer and this seems to be her next ‘home’ with fears of not being able to make rent. This is as a result of the job markets affected and the federal unemployment benefits set to end this month.

March saw the approval of the $2 trillion-plus Coronavirus Aid, Relief and Economic Security Act by the country after the pandemic hit the economy hard. This has seen many unemployed workers get $600 per week on top of the other unemployment benefits. Unless the congress renews the $600 payments, this would be the last month the workers receive them.

There has been a surge in coronavirus cases, many layoffs are expected in the hotel-casino industry, and with the winding down of the state’s temporary ban on foreclosures and evictions, there is a concern of increased homelessness and lockouts.

Gov. Steve Sisolak noted that the state’s unemployment was ‘higher than anybody else’s’

More cases recorded

On Friday, Nevada state recorded 1,004 new COVID-19 cases which went above the cases reported on the preceding week that averaged roughly 740. This also marked the second-biggest daily increase in the state since coronavirus began.

With workers having returned to work, the economy is still on a setback amid the pandemic. With the increase, the governor on Thursday ordered the closure of bars that don’t serve food.

Some local resorts have not reopened and it remains unclear how long Southern Nevada will recoup the huge job losses. As of May, Las Vegas’ unemployment rate stood at 29% as compared to February’s 3.9%. Nevada’s unemployment rate topped all states at 25.3%.

According to Dave Schmidt, more than $4.3 billion was paid by the Nevada Department of Employment, Training, and Rehabilitation for state and federal unemployment benefits which is much higher than the benefits paid during the Great Recession.

After the reopening of businesses and casinos on June 4, it will still take time before the local economy can recover fully.

Looming layoffs

Meanwhile, there are looming layoffs in the hotel-casino industry. The notices, complying with the federal Worker Adjustment and Retraining Notification Act, were sent to the furloughed staffers. Compliance with the WARN act means that they will have enough time to find work elsewhere.

MGM Resorts International, for example, in May sent the notice to at least 36,600 workers with their layoff expected to be on August 31.

Other properties that have sent the layoff notices include; Station Casinos, Boyd Gaming Corp., Penn National Gaming, Sahara Las Vegas, and Treasure Island.

Homelessness for unemployed renters

Renters are also hanging on a lifeline especially with the unemployment benefits heading to a close. Doug Bibby, President of the National Multifamily Housing Council said that if the benefits go away, ‘the country could be headed towards historic dislocations of renters and business failures among apartment firms, exacerbating both unemployment and homelessness.’

Before the pandemic, Las Vegas was already in a housing market pressure where the rents were rising higher than the wages. With the pandemic, the increased homelessness threat gets worse, according to Pete Aldous, a staff attorney for the Legal Aid Center of Southern Nevada.

The governor had ordered a temporary ban on foreclosures and evictions and had directed a gradual lifting of the moratorium from June 24 and the full resumption of evictions on Sept 1.

Aldous says that the cash-strapped tenants will ‘unfortunately’ be evicted since ‘you can’t continue forever without paying rent.’

Light at the end of the tunnel?

But as the moratorium goes down, the government agencies are working on a rental assistance program where $30 million would be offered for residential rental help and $20 million offered for commercial property rents.

A program by Clark County officials is also being created to provide utility, mortgage, and rental assistance to financially-stricken households.

Additionally, a grant program by the city of Las Vegas was also launched to provide rental and mortgage assistance for up to three months to those who lost income during the pandemic.

I'm Adam Shaw, Senior Editor and one of the first members at VegasSlots. I'm a massive football sports fan but also love casinos and occasional trips to Las Vegas. Gaming runs in the family

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