Manufacturing Gains Traction as Las Vegas Toursim Slumps; Furniture Factory Employs Hundreds
A Canadian furniture maker says its large Las Vegas plant and ties with UNLV show manufacturing can help diversify an economy hit by falling visitors, rising foreclosures and complaints about high prices
Las Vegas is seeing a contraction in tourism that city officials and analysts say is weighing on the local economy, and one manufacturer says expanding production jobs could help provide an alternative to hospitality work.
Philip Giffard, chief executive of Canadian furniture maker Foliot Furniture, said the company's Las Vegas plant employs close to 300 people depending on the season and that the business is "heavily automated but still labor-intensive." The factory opened in 2010 and will mark 15 years in the city later this month, Giffard told the Las Vegas Review-Journal, adding that the company is working with the University of Nevada, Las Vegas to encourage students to consider local manufacturing careers.
Foliot's facility, located south of Harry Reid International Airport, produces dressers, headboards and desks and covers roughly 300,000 square feet, according to company statements. Giffard said the firm has expanded since arriving in Las Vegas and is optimistic the region can become more of a manufacturing hub even though the sector remains a small share of local employment.
The Las Vegas Review-Journal reported that manufacturing accounts for about 2.7% of the city's workforce, compared with roughly 27% in hospitality. The Las Vegas Convention and Visitors Authority reported that through June, visitor volume was down 7.3% from a year earlier, marking monthly year-over-year decreases from January through June.
The drop in tourists has been tied to several factors, including complaints about high prices, geopolitical tensions and economic headwinds. Visitors have described sticker shock over everyday costs, with reports of $26 for a bottle of water at some hotel minibars and a high-profile account in which a performer said he was billed $74.31 for two drinks at a Sphere venue. The publisher of the Las Vegas Advisor told The Times that some visitors arrive already discouraged by pricing and leave early.
Beyond lower visitation, other indicators point to stress in the local economy. A report by the International Trade Administration found arrivals to the region were down 12% in a July-to-July comparison. Housing data from the University of Nevada's Lied Center for Real Estate showed 200 default notices were filed in Clark County in June, a 32% increase from the same month the prior year, and researchers cited high interest rates and reduced tourism as contributors to mounting strains.
The downturn has also coincided with changes on casino floors. Operators have increasingly turned to automated options; the Golden Gate Hotel & Casino moved to computerized gambling systems that reduce the number of human dealers on site, a shift operators say can lower labor costs but that also removes traditional service jobs.
Tipping patterns have changed as well, with some reports saying gratuities have fallen significantly for service workers. Local business owners and labor advocates say weaker tourist demand and lower per-visitor spending have hit incomes for workers who rely on tips.
City and industry officials have pursued a range of responses to broaden revenue sources and stabilize employment, including courting distribution centers, manufacturer relocations and workforce partnerships with local universities. Giffard emphasized that while manufacturing remains a "small portion" of the Las Vegas economy, it has grown since Foliot's arrival 15 years ago, and that further progress would require additional investment and workforce development.
Economists and regional planners caution that diversification is a multi-year effort. Hospitality and entertainment have long been dominant employers and revenue drivers in Las Vegas, and shifting the labor mix will depend on broader market forces, infrastructure, and incentives. For now, companies such as Foliot represent examples of manufacturing activity expanding amid an environment in which visitor counts, housing stress and consumer complaints are prompting discussions about the city's economic future.