LAS VEGAS -- It was just two weeks ago that Las Vegas native Carlos Rosales Jr. told his cousin that business at his new barbershop was doing so well that he was considering hiring a third apprentice.
After living through nearly a decade of financial uncertainty after the 2008 economic crash, the military veteran felt optimistic again. But that feeling evaporated last week when Rosales closed the barbershop in a statewide shutdown of nonessential businesses to contain the deadly coronavirus.
"I don't know how I'm going to pay my mortgage or car payments on my new truck," he said.
The virus has shaken Las Vegas' economy in an unprecedented way, ushering in a new reality for thousands of residents who only recently emerged -- some still battered -- from the last recession. Those who lost jobs and houses during the early 2010s carry those memories onto a precarious landscape of new economic challenges.
Asked to compare this to the 2008 financial crisis, which racked Las Vegas, Julie Langille, 45, a showgirl and entertainer for much of her adult life, said this is worse. "This is a little scarier. Before, yes, it impacted our industry, but it didn't shut our city down," she said. "It's never been that everything has to stop for a period of time."
In many ways, the recession hurt Nevada more than any other state. Driving the state's economy is Las Vegas, home to the Strip's $6.6 billion gambling industry and an estimated 2.2 million of the state's 3 million residents.
Around 186,000 people lost their jobs statewide because of the recession. Employment dried up, tourism stopped, construction projects stalled and people slid into foreclosures. The state was still reeling years after the crash; in 2015 Nevada led the nation in new foreclosures, according to RealtyTrac.
In response, the state set an ambitious goal to diversify its economy with financial incentives, tax abatements and workforce training programs. But after Gov. Steve Sisolak ordered nonessential businesses to close on Friday, threatening criminal citations for those that fail to comply, the coronavirus pandemic now threatens to serve as a critical stress test.Gallery: Coronavirus outbreak in Las Vegas
Back in 2009, Rosales was jobless for a year and his father, a construction worker near the Strip, lost his house to foreclosure. In recent years, however, their fortunes improved. With construction back on the rise in Sin City, his father bought two houses: one in 2014 and another one in 2017. And a year later the 35-year-old Rosales bought a three-bedroom house in Clark County.
Although his family members weathered the last crisis, he's unsure they can do it again. He tries to keep his worries to himself; he doesn't want to frighten his wife and children.
"I keep thinking about what I can do," he said. "It's in the back of my head all day."
In a high-risk, high-reward economy that depends heavily on Americans' expendable income, there's an implicit understanding that livelihoods ride on unpredictable whims. Around 40% of jobs in the state are either in leisure, hospitality or retail. A recent study by the Economic Policy Institute found that Nevada is likely to lose 5.3% of private-sector jobs.
The effect of a coronavirus-led downturn in Las Vegas could be more devastating than the 2008 financial crisis. It's a town built and run largely on the backs of hospitality workers who cater to tourists. In 2018, hotels and casinos in southern Nevada alone employed around 164,400 people, which made up 16.8% of the region's total employment.
Unite Here, a labor union that represents 300,000 workers in the hospitality industry, estimates that between 80% and 90% of its workers could lose their jobs in the coronavirus fallout.
But Las Vegans know this is a territory of inherent risk. Whether they're born and raised, or moved here with dreams of dollar signs and the ability to buy a house in the low 200s, they are stubborn through hard times. Car payments may be missed; lost wages will sting. But there's a frontier we're-in-this-together mentality among many residents.
The phrase "Vegas Strong," which gained popularity after the 2017 Route 91 Harvest Festival shooting in which almost 60 people died, is more than a platitude -- it's become something of a mantra for those who are facing economic tremors that may soon grow into something far worse.
Last week, when taxi driver Curtis Gillespie, 61, was told not to go to work anymore, it was a moment that felt all too familiar. He learned life does not progress linearly when he was fired from his job making doors in 2010, shortly after the housing market collapsed. And again when his wife died a few years ago.
He's choosing to face this crisis like he did before. He figures a man does better with grace and empathy than he does by complaining. "Other people have it worse than me," he said. And with more time on his hands these days, Gillespie said he plans to spoil his 3-year-old Chihuahua, Molly.
"It's just me and my girl these days," he said.
Business on 03/26/2020
Print Headline: Virus another tremor for Vegas