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Rod Smith

Teamsters Walkout: Experts: Duration, Intensity Key Factors in Strike Impact

8 September 2004

While the strike by Teamsters & Truck Drivers Local Union 631 against local convention services companies could have serious consequences in Las Vegas, gaming industry experts said Tuesday the ultimate impact will depend on the strike's duration and intensity.

"There's definitely potential risk and exposure for the convention center operators as well as attendees," said Brian Gordon, spokesman for Applied Analysis, a Las Vegas-based financial consulting firm.

"Some of the tactics with regard to people crossing the picket lines could drive a lot of attention," he said, possibly discouraging visitors and the booking of small- and medium-size conventions.

"The timing of the strike could be critical for the tourist industry in Southern Nevada," Gordon said.

The convention business is just emerging from its traditional summer doldrums and has been expected to enjoy its strongest fall schedule in Las Vegas history, mirroring the visitor industry's record traffic to Las Vegas.

University of Nevada, Las Vegas professor Bill Thompson, a gaming studies specialist, said if the strike lasts three to five months, it could prove devastating because it will discourage visitors and throw cold water on booking conventions.

"But it's not likely. Union workers mostly are living in the real world and have realistic wage and benefit expectations," he said.

Gordon said historically strikes here have been short-lived because workers would rather settle and work than picket, and therefore they have had minimal consequences on the local economy.

"Still, it would be a real cause for concern if it continues for an extended period of time," he said.

A source close to The Venetian, which also owns and operates the Sands Expo and Convention Center where Teamsters members Tuesday were picketing The Freeman Cos., said so far the strike has had no effect on operations.

However, he questioned the timing of the strike, pointing out that had the union wanted to maximize impact, it would have walked out before last week's MAGIC trade show, rather than after it was finished.

About 3,000 union laborers had been tearing down GES Exposition Services' recently concluded Men's Apparel Guild in California trade show at the Las Vegas Convention Center when leaders instructed them to stop working Thursday.

"It seems as if they don't want a bloodletting. Besides killing MAGIC before it started, they could also have postponed the job action until January when the really big shows start hitting town," The Venetian source said.

For example, the 2005 International Consumer Electronics Show hits town in early January with more than 115,000 attendees expected.

"The big shows need the Teamsters. It's a lot easier to set up small- and medium-size meetings with independent operators," he said.

Protesters were also demonstrating Tuesday at Bally's and Paris Las Vegas, both operated by Caesars Entertainment, and the Las Vegas Convention Center, operated by the Las Vegas Convention and Visitors Authority.

However, a source close to Caesars said the Teamsters limited their demonstration to the back edge of the property, and it was not disrupting business or antagonizing visitors.

Convention authority officials declined to comment on the strike, referring all inquiries back to GES and Freeman.

Neither Mandalay Resort Group, which operates the Mandalay Convention Center, nor MGM Mirage have yet been hit with picket lines.

However, MGM Mirage spokeswoman Yvette Monet said it was too early to say whether or not the strike would have any long-lasting impact.

"It is impossible to predict the potential impact of the strike on convention business because we don't know how long the strike is going to be. For the sake of the entire community, we hope that both sides are able to work out their differences quickly," she said.

Deutsche Bank analyst Andrew Zarnett echoed the comments from gaming operators.

"A quick resolution would mean the strike would have little impact on Las Vegas -- not if it's short-lived and doesn't impact access to the convention facilities," he said.

Zarnett said most convention attendees will not know about the strike until they have left home or arrived for meetings.

Most convention attendees will have few qualms about crossing picket lines as long as protesters remain peaceful, so the biggest impact may be on exhibitors who have trouble setting up or knocking down their booths, he said.