Business
Pequots cut 200 jobs at casino
01:00 AM EDT on Saturday, June 28, 2008
The tribe that owns the Foxwoods Resort Casino, in Ledyard, Conn., said yesterday it has laid off nearly 200 employees — which is less than 2 percent of its work force of 10,000 people.
The Mashantucket Pequots said the layoffs of middle managers and some hourly employees on Thursday are part of an organizational review begun in January.
“[Layoffs] are scattered across departments,” said Lori Potter, a tribal spokeswoman.
The job cuts are believed to be the first in the casino’s 16-year history and follow a layoff last month of a similar number of employees in the tribe’s government. Those departures were part of a larger effort to cut $40 million from the tribal budget.
The workers let go this week will get two weeks’ severance pay for each year they were employed, up to 13 years, as well as health benefits, Potter said.
“This has been a difficult week for all of us,” said Barry Cregan, Foxwoods president. “It is always sad to see fellow employees lose their jobs.
“As organizations develop, they often grow more than necessary during a sustained period of economic success.”
Potter said that the job cuts do not affect MGM Grand, where 1,747 people work in a $700-million hotel and casino wing that opened last month.
The MGM Grand addition helped Foxwoods reverse an eight-month decline in slot-machine revenues. Last month, Foxwoods saw a nearly 8-percent increase in its slot win compared with May of last year. Nearby rival Mohegan Sun casino also eked out an increase last month as slot win crept up two-tenths of a percent. Slot win is the money left after the machines pay out winnings to bettors.
The casino industry, like many other employment sectors, is being hurt by a shaky national economy. Spiking fuel prices and plummeting home values are making many Americans cautious about spending.
Figures from the 12 states where commercial casinos are legal show gambling revenue in the first three months of the year remained about where it was last year, according to the American Gaming Association, but that spending was spread across more, and larger, venues than the same period a year ago.
“Those [states] that are up aren’t up that much,” said Holly Thomsen, the association’s communications director. “The losses due to the economy have been offset by the fact that there are more casinos.”
The association’s latest estimates follows a 1.3-percent drop recorded in the three months that ended Jan. 31, compared with the same period a year ago.
The job cuts at Foxwoods came as a Key Banc Capital Markets analyst yesterday trimmed estimates on three casino operators, saying customers are cutting back on gambling in Las Vegas due to high fuel prices and economic concerns.
The analyst, Dennis Forst, said spending is down in all U.S. gaming markets and will probably get worse.
Based on revenue figures from last month, the Twin River slot parlor in Lincoln may generate $416.6 million in income from its 4,751 video-lottery terminals, yielding $254.5 million for the state in the fiscal year beginning July 1, according to an estimate provided this month to The Journal by the Rhode Island Lottery. Previous state estimates anticipated $261.4 million from Twin River.
Twin River said that this week-end it will close the buffet it offers gamblers as the slot parlor revamps its food menu. An undisclosed number of outlets operated by national restaurant chains will replace the buffet, said Twin River spokeswoman Patti Doyle.
The buffet workers, about 20 to 30 in all, will be offered jobs with the chain outlets or may be able to fill other job shifts at Twin River. The buffet opened last year, part of the renovation that transformed the aging Lincoln Park greyhound racetrack into Twin River.
The changeover comes as Twin River’s owner, UTGR Inc., struggles to pay off $577 million in debt that its parent company accumulated to purchase the Lincoln facility and four others in Colorado, and then renovate the Rhode Island location.
Efforts by Twin River’s owners to expand their gambling operations in Colorado are stalled, falling victim to the political climate out West and financial problems in Rhode Island, according to observers in the Rocky Mountain State.
UTGR’s parent, BLB Investments LLC, will halt racing June 28 at Mile High Greyhound Park, located in the Denver suburb of Commerce City, Colo.
BLB closed the Cloverleaf Kennel Club, in Loveland, Colo., last year. It also owns racetracks in Aurora, Colorado Springs and Pueblo, Colo.
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