Up or down? Charlotte hospitality industry, unemployment stats say two different things

By: Sam Boykin//January 14, 2011//

Up or down? Charlotte hospitality industry, unemployment stats say two different things

By: Sam Boykin//January 14, 2011//

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From October to November, a record-high 3,500 jobs were shed in Charlotte’s leisure and hospitality industry, according to the latest unemployment data from the Employment Security Commission of North Carolina.

It’s the most jobs lost in a single month in that sector in Mecklenburg County since 1990, when the ESC started tracking the data, said Gregory Pittman, supervisor with the ESC’s Labor Market Information Division. It’s 400 more jobs lost in the county compared with the same period in 2009 and 1,300 more compared with the same period in 2008.

Some of the loss in the Charlotte area can be attributed to a normal loss of leisure jobs toward the end of every year. The theme park Carowinds eliminates 1,100 to 1,200 seasonal positions starting in October, said Charlie Blanchard, Carowinds’ human resources manager. Seasonal jobs are also lost when Verizon Wireless Amphitheater, a large outdoor-concert venue, shuts down for the winter, which is also when the U.S. National Whitewater Center scales back many of its offerings.

But the record-high drop in Charlotte-area leisure and hospitality jobs has stunned local industry officials, who say business remained steady or even improved in the latter part of 2010.

“I don’t get it,” said Sid Smith, executive director of the Charlotte Area Hotel Association. “That number seems awfully high.”

Good signs

Smith said October was actually a good month for Charlotte hotels, as the occupancy rate was at 61.1 percent, compared with 55.8 percent in October 2009. Also, from January through October, the rate was 58.5 percent, up from 52.4 percent during the same time period the previous year.

There are other signs that the local hospitality industry is picking up, he said. The hotel association has a bus pass program, in which it provides passes at a discount to member hotels, which then give them to employees. Member hotels ordered 6 percent more passes in November than October, signaling that, if anything, they expected to add employees, not eliminate them, Smith said.

The ESC’s numbers also surprised Joseph Hallow, president and chief operating officer of Bissell Hotels, which owns and operates four hotels in Ballantyne in south Charlotte.

Hallow, who is on the Charlotte Regional Visitors Authority’s board of directors, said October and November are usually strong months for hotels, as many add seasonal employees to gear up for an increase in corporate year-end meetings and conventions and holiday parties.

“I haven’t heard from anybody about that type of dramatic job loss,” he said.

Mohammad Jenatian, president of the Greater Charlotte Hospitality and Tourism Alliance, said the ESC’s numbers seem inflated. But any spike in lost jobs stems from seasonal jobs being eliminated, he said.

“There’s hasn’t been any big closings or layoffs that I know of,” he said. “Business has been great over the last few months in the hotel and restaurant business. Many in the industry have been hiring people.”

Survey says

Larry Parker, spokesman for the ESC, said unemployment figures are estimates based on employee surveys. The information is collected through Current Employment Statistics, a federally funded program that the Bureau of Labor Statistics contracts out to each state to collect employment data through a statistical sample.

Each month, the CES program surveys about 140,000 businesses and government agencies nationwide, representing approximately 410,000 individual worksites, in order to provide detailed industry data on employment, hours and earnings of workers on nonfarm payrolls, Parker said.

In North Carolina, 15,000 to 18,000 employees are surveyed every month for the reports, he said.

Parker declined to give the number of employers surveyed in the Charlotte metro area, and because of sample confidentiality he couldn’t name any employers. More than a dozen industry sectors are surveyed monthly, such as mining and logging, construction and manufacturing. The leisure and hospitality sector includes arts, entertainment, recreation and accommodation and food services.

Others puzzled

Like Smith and Hallow, Tom Gabbard — president of the North Carolina Blumenthal Performing Arts Center, an uptown facility that is home to arts organizations, such as the Charlotte Symphony, North Carolina Dance Theatre and Opera Carolina — was surprised at the number of jobs lost in the Charlotte-area hospitality and leisure sector as reported by ESC.

Gabbard said other than about five layoffs this summer, employment at Blumenthal, whose fine arts season runs from September to May, has been steady.

“And because of the economy, we find that people are traveling less and coming to more of our shows,” he said.

Robert Bush, the Arts and Science Council’s senior vice president of cultural and community investment, said he’s unaware of any layoffs in the nonprofit cultural sector.

“In fact, we are seeing groups begin to fill positions that have been vacant for 12 to 18 months,” he said.

Steve Seitz, director of operations for Harper’s Restaurant Group, which owns and operates seven Charlotte restaurants, said they didn’t have any layoffs in October.

“Historically, the fourth quarter is a good time for our restaurants,” he said. “There’s a lot of activity with holiday parties and a natural increase in dining out.”

Moira Quinn, senior vice president of communications for Charlotte Center City Partners, said she’s at a loss over the reported spike in lost jobs.

“Uptown is doing really well with restaurants and bars opening,” she said.

Tim Newman, CEO of the Charlotte Regional Visitors Authority, said he doesn’t usually look at a particular month’s employment numbers because there are so many fluctuations at seasonal attractions, such as Carowinds and the Whitewater Center.

Instead, he focuses on hospitality tax collections.

From July 1 to Oct. 31, hotel occupancy tax collections were $8.2 million, up 24 percent from the same period last fiscal year, Newman said. Meanwhile, prepared food and beverage tax collections were $7 million, an increase of 9 percent from last year.

“I think the ESC numbers are an anomaly,” he said. “We’ve continued to see increases in hospitality tax collections, and that means that overall spending in the sector is growing,” he said.

Sam Boykin can be reached at [email protected].

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