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Last Updated: Wednesday, 31 March, 2004, 23:06 GMT 00:06 UK
Las Vegas workers hit pay jackpot
Stephanie Flanders
BBC Newsnight economics editor in Las Vegas

slot machines, Las Vegas
The city's economy is built on gambling

If there's a city that embodies the new American economy it's Las Vegas.

It's been the fastest growing city in America for 30 years: the population doubles about every decade.

Like most successful parts of the country, its growth has depended on two key ingredients: a phenomenally successful service-based industry, and a lot of new arrivals.

The city's Hispanic population alone has tripled since 1990.

It's actually one of the few places in the US that has carried on creating jobs since 2001.

But there's something much more surprising about Vegas.

It's one of the few places where most of the workers that count are members of a union.

Healthcare

One of them is Bernice Thomas, a mother of eight and grandmother of many.

A lot of people don't understand the union
Bernice Thomas
Las Vegas worker
She first came to Las Vegas in 1956 from Tallulah, Louisiana, the same year that Dean Martin and Jerry Lewis did their last joint show at the Copacabana.

Her first steady job was as a housekeeper cleaning rooms at the Mint Hotel on Las Vegas Boulevard, known locally as the Strip and the only street that most tourists usually see.

When The Mint closed down a few years later, she went to The Dunes - the iconic rat pack venue - where she worked for 21 years until it too got pulled down in the 1990s.

So far, so unremarkable.

But in her first job she also signed up to the Culinary Workers Local 226, the Vegas branch of the national Hotel Employees and Restaurant Employees Union.

That has made a big difference.

"A lot of people don't understand the union," she told me when I met her recently filming for Newsnight.

"They look at their wages and they think they're doing as well as they would with the union.

"But when the hotel closes or they have to go someplace else, they get nothing. If you're in a union you still have all the money that went into a pension. You have benefits. You have security."

She also had her own home, a health plan that covered all 8 children for a fraction of the cost of most non-union plans, and the chance to see several of them go off to college.

When her husband got cancer two years ago she didn't have to pay for any of the treatment.

"He was in the union so we had double cover. When he passed, I didn't have to pay a penny for the funeral or anything."

Her non-union brother-in-law died a few weeks ago, and the family was stuck with a $2000-plus bill.

Growth

Mrs Thomas was at pains to emphasise how much hard work had gone into making a life in Vegas.

Vegas Golden Nugget casino hotel
Las Vegas is America's fastest-growing city
But when she spoke of the union, she spoke in the way you'll hear many of her background in America talk about their church.

What does this slightly saccharine story have to do with outsourcing and the much vaunted "hollowing out" of good middle class jobs?

Maybe more than you think.

Because it turns out that Bernice's old-time unionised existence isn't just a throwback.

Well not in Vegas, anyway.

In the mid-1980s, the Culinary had about 15,000 members.

Now it has more than 50,000.

In a country where 8% of private sector workers are in a union, around 70% of restaurant and hotel workers in Las Vegas work on a union contract, and the share is more than 90% on the all-important Strip.

The Bellagio, which was recently voted the fourth best hotel in the world, is a union shop.

So is the MGM Grand, the world's largest.

And so is Paris (that's the one that's a not-so-mini version of the Eiffel Tower).

Good for business

It's no surprise that Bernice worships the union.

What is less predictable is that some of the city's big-time executives have learned to see the upside as well.

You take the cost of labour out of the equation if you allow workers to bargain collectively - so we can all compete on who has the best clubs, the nicest hotels, the best entertainment, not on how much we pay. It's worked very well for us in Vegas.
Mike Sloan
senior vice-president of the Mandalay Resort Group
"You have to have a good workforce when you're in the hospitality business - because they're the only part of the company that your customers see," said Mike Sloan, Senior Vice-President of the Mandalay Resort Group, one of the big four hotel groups on the Strip.

"There are hotels that have spent more money compensating workers for not being in the union than they would on a union contract.

"Others just don't want to pay the cost - and maybe they're running 20% cheaper than we do.

"But in the long run they'll pay for it in higher turnover and lower morale."

Collective bargaining

Not every hotel executive in Vegas sees thing as Sloan does.

In fact, we had trouble getting any of them in front of a camera to talk about the union.

Employer-union relations are not all sweetness and light here, any more than they are anywhere else.

Given the choice, most would probably rather not have to deal with a union at all, and there are some high profile holdouts even on the Strip.

But as someone who's just negotiated a new five year deal with the Culinary, Mr Sloan seems sincere when he explains how unions might have something to offer in an industry that depends critically on the quality of its staff.

He even suggests that this was why unions have always been exempt from US anti-trust (or price-fixing) laws.

"You take the cost of labour out of the equation if you allow workers to bargain collectively - so we can all compete on who has the best clubs, the nicest hotels, the best entertainment, not on how much we pay. It's worked very well for us in Vegas."

New middle class

There's even a Culinary Workers' Training Academy in the suburbs, jointly funded by employers and the union.

In the past ten years it's trained 34,000 people for jobs on the Strip, in everything from hospital corners to knowing a fine Bordeaux.

Ms Thomas teaches housekeeping 101 and (more saccharine) she says she takes real pride in passing on what she knows.

Her son Steve came back from college to do an entry level hotel job.

Now he's Director of Housekeeping at the Rio with 500 people working under him.

"There's this myth that manufacturing jobs were always great jobs," said D Taylor, Secretary-Treasurer of the local 226.

"But before they were unionized, they were just like a lot of service sector jobs today: crummy jobs with high turnover and bad morale.

"We have to do the same thing here that we did in manufacturing.

"These service sector jobs have to become the new middle class jobs here in America - because they can't move out casinos to Malaysia."


SEE ALSO:
Vegas hosts the tech of tomorrow
07 Jan 04  |  Technology
Jobs become US election issue
26 Feb 04  |  Business
US jobs growth gathers pace
06 Feb 04  |  Business


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