[Senate Hearing 117-773]
[From the U.S. Government Publishing Office]
S. Hrg. 117-773
INVESTING IN AMERICA'S TOURISM
AND HOSPITALITY WORKFORCE
AND SMALL BUSINESSES
=======================================================================
HEARING
BEFORE THE
SUBCOMMITTEE ON TOURISM, TRADE,
AND EXPORT PROMOTION
OF THE
COMMITTEE ON COMMERCE,
SCIENCE, AND TRANSPORTATION
UNITED STATES SENATE
ONE HUNDRED SEVENTEENTH CONGRESS
FIRST SESSION
__________
MAY 25, 2021
__________
Printed for the use of the Committee on Commerce, Science, and
Transportation
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Available online: http://www.govinfo.gov
__________
U.S. GOVERNMENT PUBLISHING OFFICE
54-132 PDF WASHINGTON : 2023
SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION
ONE HUNDRED SEVENTEENTH CONGRESS
FIRST SESSION
MARIA CANTWELL, Washington, Chair
AMY KLOBUCHAR, Minnesota ROGER WICKER, Mississippi, Ranking
RICHARD BLUMENTHAL, Connecticut JOHN THUNE, South Dakota
BRIAN SCHATZ, Hawaii ROY BLUNT, Missouri
EDWARD MARKEY, Massachusetts TED CRUZ, Texas
GARY PETERS, Michigan DEB FISCHER, Nebraska
TAMMY BALDWIN, Wisconsin JERRY MORAN, Kansas
TAMMY DUCKWORTH, Illinois DAN SULLIVAN, Alaska
JON TESTER, Montana MARSHA BLACKBURN, Tennessee
KYRSTEN SINEMA, Arizona TODD YOUNG, Indiana
JACKY ROSEN, Nevada MIKE LEE, Utah
BEN RAY LUJAN, New Mexico RON JOHNSON, Wisconsin
JOHN HICKENLOOPER, Colorado SHELLEY MOORE CAPITO, West
RAPHAEL WARNOCK, Georgia Virginia
RICK SCOTT, Florida
CYNTHIA LUMMIS, Wyoming
David Strickland, Staff Director
Melissa Porter, Deputy Staff Director
George Greenwell, Policy Coordinator and Security Manager
John Keast, Republican Staff Director
Crystal Tully, Republican Deputy Staff Director
Steven Wall, General Counsel
------
SUBCOMMITTEE ON TOURISM, TRADE, AND EXPORT PROMOTION
JACKY ROSEN, Nevada, Chair RICK SCOTT, Florida, Ranking
AMY KLOBUCHAR, Minnesota DAN SULLIVAN, Alaska
TAMMY DUCKWORTH, Illinois MARSHA BLACKBURN, Tennessee
JON TESTER, Montana RON JOHNSON, Wisconsin
KYRSTEN SINEMA, Arizona SHELLEY MOORE CAPITO, West
JOHN HICKENLOOPER, Colorado Virginia
CYNTHIA LUMMIS, Wyoming
C O N T E N T S
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Page
Hearing held on May 25, 2021..................................... 1
Statement of Senator Rosen....................................... 1
Statement of Senator Scott....................................... 3
Statement of Senator Klobuchar................................... 22
Statement of Senator Blackburn................................... 24
Witnesses
D. Taylor, International President, UNITE HERE................... 5
Prepared statement........................................... 6
Bill Lupfer, President and CEO, Florida Attractions Association.. 9
Prepared statement........................................... 11
Shaundell Newsome, Chair, Urban Chamber of Commerce Las Vegas.... 12
Prepared statement........................................... 14
Drew Daly, Senior Vice President and General Manager, Cruiseone,
Dream Vacations and Cruises Inc................................ 15
Prepared statement........................................... 16
INVESTING IN AMERICA'S TOURISM
AND HOSPITALITY WORKFORCE
AND SMALL BUSINESSES
----------
TUESDAY, MAY 25, 2021
U.S. Senate,
Subcommittee on Tourism, Trade, and Export Promotion,
Committee on Commerce, Science, and Transportation,
Washington, DC.
The Subcommittee met, pursuant to notice, at 3:03 p.m., in
room SR-253, Russell Senate Office Building, Hon. Jacky Rosen,
Chairwoman of the Subcommittee, presiding.
Present: Senators Rosen [presiding], Klobuchar, Scott, and
Blackburn.
OPENING STATEMENT OF HON. JACKY ROSEN,
U.S. SENATOR FROM NEVADA
Senator Rosen. Good afternoon and welcome to today's
hearing, Investing in America's Tourism and Hospitality
Workforce and Small Businesses. Today we will examine the state
of the tourism and hospitality workforce in the wake of the
COVID-19 pandemic, as well as the experiences and challenges of
the tourism and hospitality related small businesses, and those
business outside the industry who, nonetheless, depend on
travel and tourism to bring them customers.
We will also review regional impacts of the pandemic on
communities that rely on tourism and hospitality workforce and
receive insight on how Congress can support workers and small
businesses, as the travel and tourism industry recovers.
U.S. hotel and hospitality industry continues to experience
severe pandemic-related impacts and, consequently, so do the
workers in that industry. For Nevada, this is almost 25 percent
of our work force. Prior to the pandemic, in 2019, Nevada's job
market exhibited signs of strength, with a seasonally adjusted
unemployment rate of about 3 percent. Just over 1 percent
unemployment rate among workers covered by unemployment
insurance.
However, by mid-March 2020, as the world began seeing the
impacts of the public health crisis, situations started to
change dramatically. Our seasonally adjusted unemployment rate
rose to over 6 percent, followed by a steep and unprecedented
increase to 30 percent in April 2020. The highest unemployment
rate in the Nation, I may add.
So, for two weeks in March, initial unemployment claims
increased, from just over 6,000 to over 92,000 claims. This
significant rise in unemployment in Nevada, in part, reflects
our State's reliance on leisure and hospitality employment in
the State economy.
Tourism drives most of the demand in the hospitality
industry, and COVID-19 decimated tourism. At the onset of the
crisis, Nevada's leisure and hospitality sector was the largest
contributor to wage and salary employment. In February 2021--
2020, excuse me, the leisure and hospitality sector employed
over 356,000 workers, in a State with an overall population of
just a little over three million.
Taken together, this data suggests that workers in leisure
and hospitality have probably borne the brunt of unemployment
in Nevada. According to the Bureau of Labor Statistics
nationwide, leisure and hospitality lost 2.8 million jobs
during the pandemic that have yet to return. This represents
more than 25 percent of all unemployed persons in the United
States.
The 99 percent of businesses in Nevada that are small
businesses have also struggled, particularly minority-owned
small businesses who are far too often disproportionately
impacted economic slowdowns and left behind in economic
recoveries. I have made support for workers in small businesses
one of my top priorities during the pandemic. And I call on my
colleagues here today to not lose sight of the fact that this
has been an uneven recovery, one in which small businesses and
workers, in the hardest hit states, and will continue to need
our help until we are fully past the pandemic.
We will build back better. But it is going to take time and
it is going to take investment. While many industries in Nevada
are starting to come back, statewide, the leisure and
hospitality industry is only at 70 percent of its pre-COVID
peak employment levels. That is down more than 106,000 jobs.
The strong and robust presence of organized labor in Nevada
directly aids the recovery for workers. Compared to other
states in the Mountain West, Nevada has maintained a relatively
higher rate of unionization in recent years, according to the
Bureau of Labor Statistics. In 2019, more than 14 percent of
employed workers in Nevada belong to unions, which is an
increase of 2.5 percentage points over 2016 levels. And it is
much higher than the nationwide figure of just over 10 percent.
Unions in Nevada helped to improve quality of employment
relationships and working conditions. You know, as a college
student coming home for the summer, I was a member of Nevada's
Culinary Workers' Union, Local 226, when I waited tables at
Caesar's Palace. And I am grateful for that job that helped me
pay for my college tuition. And you know, the Culinary Workers'
Union is the largest private-sector union in Nevada. It
represents approximately 60,000 workers and organizes them in
casino and hotel properties on the Las Vegas strip and
downtown--represents housekeepers, bartenders, bellmen, and
many others.
The Culinary Workers' Union has been a lifeline for the
hospitality workforce in Nevada. And in fact, the very last in
person meeting I took in Capitol Hill, before we closed our
offices in March due to the pandemic, was with Mr. D. Taylor,
President of UNITE HERE, the union with which Nevada's Culinary
226 is proudly affiliated. So, I am pleased to have him here
today testifying as an expert witness.
Mr. Taylor and UNITE HERE have gone above and beyond during
the pandemic, to support the workers they represent, even
running their own food bank when the local economy was in the
most dire situation. In the early months of the pandemic, when
98 percent of the more than 300,000 UNITE HERE workers were out
of work, Mr. Taylor and the union stood by their members. And I
look forward to his testimony here today, about how we get
tourism and hospitality moving again.
Also, testifying virtually today, to share their expertise,
insight, and recommendations, we have Nevada's own Shaundell
Newsome, Chair of the Las Vegas Urban Chamber of Commerce,
which works to provide access to local, national, and global
markets for small and diverse businesses in Southern Nevada.
In addition, we are pleased to have representatives with us
from the following organizations, of course, virtually. The
Florida Attractions Association which promotes and advances the
interest of businesses in the attraction industry, and World
Travel Holdings, a leisure company.
It is my hope that today's hearing will help us better
understand the challenges the small businesses and the
hospitality work force--the challenges that they face, as a
result of depressed business and leisure travel caused by the
pandemic. And that today's hearing will provide a forum for an
engaging discussion on how to support workers and small
businesses, as they recover.
Thank you all again for being here today. I look forward to
hearing each of you share your experiences and expertise. And
now, I am going to turn it over to Ranking Member Scott for his
opening statement, and then, we will introduce our witnesses.
Senator Scott.
STATEMENT OF HON. RICK SCOTT,
U.S. SENATOR FROM FLORIDA
Senator Scott. Yes, I want to thank Chair Rosen for hosting
this hearing today. I want to thank all the witnesses for being
with us and sharing your perspectives.
There is a lot that the State of Nevada, especially Las
Vegas, has in common with the State of Florida. We are very
much dependent on our tourism industry and I know we have four
wonderful witnesses today that are going to talk about the
impact that it has had on our small businesses. I want to thank
Bill Lupfer and Drew Daly for testifying today and sharing
their insights from Florida's small businesses and their
employees.
Florida, like Las Vegas, is a global travel destination.
People from all over the world come to enjoy our beaches, our
attractions, and all our state has to offer. When I was
Governor, we worked hard to grow our tourism industry. And we
actually were able to grow it from about 80 million tourists a
year, by the time I left to 126 million tourists. A record each
of those years.
I know this pandemic has impacted each of us differently
and all of our small businesses differently. We have had to
adapt to make sure our families, our businesses, and our
employees stay safe. Unfortunately, the COVID-19 pandemic has
severely hurt Florida's travel and tourism industries, which
comes with a chain of economic impacts on our restaurants, our
small businesses, and our families. And I know Chair Rosen has
seen the same thing in Las Vegas and Nevada.
I am glad to see that Florida is open for business again.
But in order for our State and our Nation to fully reopen and
get our economy back on track, we have to continue to work
together. I have been hearing from many of our small businesses
in Florida, they are struggling to find workers to fill their
open jobs because they are competing with enhanced Federal
unemployment benefits. I have supported targeted aid for
struggling families and businesses, but I have been clear that
the Federal Government should not be paying Americans more to
stay home than go back to work.
I am glad to see Governors across the Nation are taking
action to get their citizens back to work. I am also on a bill
with several of my colleagues to phaseout this disincentive to
work. While I will always work to support our small businesses,
get Americans back to work, and get our economy fully open. But
we also always have to make sure we help those that still need
our help.
I have also been very focused on getting the safe
resumption of our cruise line operations. Something that,
hopefully, a lot of people from Las Vegas enjoy, but we do not
see many cruises from Las Vegas. So, many of our businesses and
workers that rely on the cruise industry have been left at a
standstill for over a year now, waiting for the CDC guidance,
while so many industries have reopened. You can go to a
restaurant. You can go to an amusement park. You can go stay in
a hotel. But the CDC has made it very difficult for our cruise
industry to get started again.
I am glad the CDC has finally answered my call and the call
of many of my colleagues, to get things moving in the right
direction, so our cruise industry can get back to work. But the
CDC, unfortunately, has treated our cruise industry terribly
over the past year. And I am going to continue my fight and
work with the CDC to make sure we reach a quick and equitable
solution that keeps people safe that want to cruise, the
employees safe, but also protects the jobs in Florida. And I
know there are jobs in Las Vegas tied to the cruise industry,
and all across our Nation.
As our Nation works to recovers from the coronavirus and
get our economy back on track, I remain committed to doing
everything I can to support our travel industry in Florida, and
across the United States.
I look forward to hearing from all of our witnesses. I want
to thank--again, thank Chair Rosen for organizing this hearing
and inviting the witnesses she has invited. And all of us want
to understand how the COVID-19 has impacted our industries and
how we can help them succeed. So, thank you. Thanks again,
Chair Rosen.
Senator Rosen. Thank you. And you can cruise on Lake Tahoe
and Lake Mead.
Senator Scott. That is right.
Senator Rosen. It is not the same as a Caribbean cruise
but----
Senator Scott. Actually, it is fun.
Senator Rosen.--you can have a nice dinner cruise on both
of those. So, thank you, Senator Scott.
I would like to introduce our first witness, who is
testifying with us remotely today, D. Taylor. He is the
International President of UNITE HERE. With over 40 years in
the labor--experience in the labor movement, Mr. Taylor has
successfully organized labor negotiations throughout the
country, and has helped grow the culinary union in Nevada to
its current membership level of nearly--approximately 60,000
members.
Nationally, UNITE HERE currently represents over 300,000
active union members who work in various roles in the
hospitality industry--hotels, food service, laundry,
warehouses, and casinos. Mr. Taylor, you are now recognized for
your opening remarks.
STATEMENT OF D. TAYLOR, INTERNATIONAL PRESIDENT, UNITE HERE
Mr. Taylor. First, I want to thank you, Senator Rosen and
Senator Scott. It is a real honor and privilege to actually
speak in front of you all. Hopefully, this will be the last
remote hearing that I have to be involved with, because I am
sure, like everybody else, we are really tired of Zoom.
So, we represent over 300,000 members, throughout the
United States and Canada. At the beginning of the pandemic, 98
percent of our workers were laid off and, even today, 50 to 60
percent are still not working.
First, in the gaming industry, employment has increased
more in the gaming industry, but still it is far behind in what
it was before the pandemic. In Atlantic City, we have about 75
percent of our members back. In Ohio about 75, Detroit about
65, Mississippi about 65, Las Vegas a little over 50 percent,
and New Orleans 32 percent. And some of the reasons why our
workers are not back is because casinos have moved to eliminate
a fair amount of food and beverage jobs and also, changes in
housekeeping.
In food service, the employment there, for example, airline
catering. We have about 70 percent of our workers back, but
that has really been paid through the CARES Act funding. In
traditional cafeterias, only about 55 percent. In airport
concessions, when people come through, only about 45 percent.
And in stadiums and arenas, less than 40 percent and big
convention centers, 5 percent or less. And there is real
concern there about when those jobs will come back because that
involves both large and small employers.
And in hotel employment, there is really a bifurcation in
those--some of those leisure markets like Florida, Arizona, and
Hawaii. We are starting to return back to pre-COVID levels, but
not where it was. But in those markets that have been heavily
relying on business, groups, international travel, those
numbers are so far below what it was before the pandemic, it
has affected the abilities of people to come back to work.
Now, we have a concern, too, in the last two downturns,
after 9/11 and the Great Recession, some of those temporary job
reductions became permanent. And in fact, between 2001 and
2019, hotel industry employment, by room count, decreased by 20
percent. And we have issues, which we have found to be
perplexing.
In many cases, we have heard about the inability to get
people to come back to work, and at the same time, I think some
of that has been caused by the inability of companies to say,
you have the right to be recalled. And as we all know, older
workers that are terminated, 1 in 10 earn much less than what
they earned previously. And so, on one hand, we have a cry for
workers and the other hand, just the basic idea of somebody has
been with the company 20 or 30 years has to start off as a new
hire somewhere. You can understand that quandary. And in fact,
here in Las Vegas we had that problem where Station Casinos
fired 7,000 workers. So, they have to start all over again,
even if you have been with the company 20 or 30 years.
Subcontracting, United Airlines got an enormous amount of
money from the payroll support program, $7.7 billion, actually,
from the government. And now they are looking to subcontract
out all their kitchens, with no guarantee of work or benefits.
And service cuts, many hotel owners have been extremely
aggressive about this. Like, for example, to end daily room
cleaning. And so, for example, the CEO of Park Hotels, the
biggest private sector of owners--owner of Hiltons, have said
they want to have a permanent reduction of full-time, hotel
level staffing.
So, on one hand, we have companies that have really done
the right thing and I want to point out one from Florida and
one from Nevada. In Florida, Disney, for example, has done
tremendous work. They extended health care benefits for all
their employees, throughout this pandemic and loaded up all the
unemployed people into the Florida system which, as everybody
knows, had some serious issues. And in Nevada, the Wynn Resorts
stepped up completely on continuing to pay people and also,
extend benefits.
So, we are worried about the future and, at the same time,
we think there is a lot that needs to be done to get back on
our feet, both with companies and workers.
Thank you so much, Senator Rosen and Scott.
[The prepared statement of Mr. Taylor follows:]
Prepared Statement of D. Taylor, International President, UNITE HERE
Chairwoman Rosen, Ranking Member Scott, and Members of the
Subcommittee, thank you for inviting me to testify today.
UNITE HERE represents over 300,000 workers in hospitality,
including hotels, gaming, food service, airports, and more. Our members
are overwhelmingly women and people of color, and they were among the
hardest hit by the COVID-19 virus itself and by job loss and everything
that comes with it--trying to make rent, put food on the table, and get
health care for their families. Ninety-eight percent of our members
were laid off at the start of the COVID-19 pandemic, and 70 percent
remain out of work today.
Current employment levels in hospitality vary widely by sector and
region.
Nationally we estimate that 70 percent of UNITE HERE airline
catering workers have returned to work or are being paid through CARES
Act funding. Employment levels for our members are around 55 percent in
traditional cafeterias (including corporate, higher education,
manufacturing, and tech cafeterias), 45 percent in airport concessions,
40 percent in stadiums and arenas, and 5 percent or less in convention
centers. A key concern in food service is that we do not yet know how
corporate cafeteria workers will be affected if major companies such as
Facebook allow employees to continue working from home after the
pandemic restrictions end. We estimate that this could result in
permanent job loss for 3,000 to 5,000 of our members.
In gaming, employment is approaching pre-COVID levels for our
members in some regional markets. Seventy-five percent of our members
in gaming are back to work in Atlantic City and Ohio, 65 percent are
back in Detroit and Mississippi, and just under 60 percent are back in
Southern Indiana. Employment is lagging in destination markets that
depend on group business and air travel. Only 50 percent of our members
in gaming have returned to work in Las Vegas, and just 32 percent are
back in New Orleans.
Hotel employment varies widely by region. Hotels in some leisure
markets like Florida and Hawaii have returned to pre-COVID occupancy
levels, while occupancy remains lower in markets focused on business,
group, and international travel.
Some have suggested that Americans who are laid-off and on
unemployment just don't want to return to work. In fact, employers in
the hospitality industry are trying to reduce staffing, and the way to
help get Americans back to work is not by slashing the safety net but
by holding hospitality companies accountable to bring jobs back.
Americans are smart. They want a steady income, but they need
childcare, they want to be safe, and they want a job that's worth it.
Workers with kids--especially women--may not have access to in-
person schooling or childcare where they trust that it's safe. Many
workers are still waiting to be two weeks past their second dose, so
they're not fully vaccinated yet. And finally, a lot of folks felt
burned by sudden layoffs and termination of benefits at the beginning
of the pandemic, so some have left for industries that they perceive to
be more stable.
Frankly, if you're an employer worried that people make too much on
unemployment, that probably means that you've been getting away with
poverty jobs and now the chicken has come home to roost. You've got to
ask, are you paying enough and offering the kind of benefits that make
a job worth taking? Our union has won hospitality jobs that are worth
it, and where that's the case, people are ready and waiting to get
called back.
The real question is--are those good jobs going to be there? Some
hospitality employers are using this crisis to try to make jobs worse
or to eliminate them altogether. Business is returning, but the
hospitality industry is leaving workers out of the comeback in three
ways:
First is denying workers what we call ``recall rights.'' In most
cases, unless you have a union contract, there's nothing that requires
your employer to bring you back when the business returns. Workers who
are terminated and replaced rather than ``recalled'' make on average
11.8 percent less in wages when they get a new job. Of older workers
who are laid off involuntarily, only 1 in 10 will ever earn as much
again.
Look at Station Casinos, which fired 7,000 of its employees.
Longtime Station Casinos workers have lost their jobs as a result of
the COVID-19 pandemic due to no fault of their own, and they should get
their jobs back when their businesses reopen or resume operations. But
Station Casinos has opposed Senate Bill 386, a proposal in Nevada's
state legislature that would assure worker's Right to Return.
Another example is the food service company HMSHost, which
furloughed over 9,000 employees in March 2020. In some places HMSHost
has refused to provide assurances that it will bring back workers as
air traffic returns, and in at least one case it moved to replace
longtime workers with new hires. Without ``recall rights'' a company
can throw you out like an old pair of shoes. We can't let that happen.
Second is subcontracting. Companies can save money by switching to
contractors with lower wages, few or no benefits, and no union. Look at
United. United got $7.7 billion from the Payroll Support Program, which
was designed to keep workers in their jobs so the industry could
rebound faster. The PSP has restrictions on job eliminations, but
there's a loophole: the restrictions are going to expire in the fall,
and United has already solicited bids from contractors to outsource its
catering kitchens when the PSP restriction ends. These are industrial
kitchens where workers prepare the food and beverage that's served in
flight, and that's 2,500 jobs in Cleveland, Denver, Honolulu, Houston,
and Newark. United has refused to promise longtime workers that they
will be able to get a job with any contractor that starts doing the
work, or maintain their pay and benefits. We're asking Treasury to stop
United from exploiting that loophole. Subcontracting threatens good
jobs.
Third is service cuts. Some hotel owners are pushing operators to
make permanent cuts to the services they offer guests, which means that
those hotels will need less workers even when they get back to peak
occupancy.
In November of 2020, Thomas Baltimore, the CEO of Park Hotels,
which is the biggest private sector owner of Hilton hotels, said that
Park Hotels would pursue ``permanent reduction of fulltime, hotel level
staffing.'' In May of 2020, Host CEO Jim Risoleo said, ``We view . . .
this crisis truly as an opportunity to redefine the hotel operating
model,'' explaining in November 2020, ``We won't have the incremental
cost associated with housekeeping.'' Host is the largest private sector
owner of Marriott hotels.
This is part of a pattern. After each of the two most recent crises
in tourism, 9/11 and the Great Recession, hotels slashed jobs. Many
workers were never brought back, and from 2001 to 2019 the hotel
industry ultimately cut employment levels, measured by the number of
employees per hotel room, by 20 percent.
This time around, some hotel owners are pursuing so-called labor
``efficiencies'' through reduced cleaning services in housekeeping,
reduced food and beverage amenities, and other permanent cuts to guest
services. We estimate that the end of daily room cleaning alone would
result in the elimination of up to 180,000 U.S. jobs. In gaming, some
casinos are moving to eliminate jobs in food and beverage, such as by
replacing buffets with fast food.
Honestly when you think about a hotel with no daily room cleaning,
where the F&B is just grab-and-go, that's almost like a college dorm
experience. That's bad for customers, but it's also bad for workers and
communities because housekeepers, cooks, servers--that's the backbone
of the service economy. Taking away those jobs would mean some people
will never recover.
UNITE HERE members just want to provide for their families, but
we're seeing employers use the pandemic to eviscerate the jobs of women
and people of color. That's the real threat to our economic recovery.
When we talk about getting folks back to work, the way you do that
is not by taking unemployment benefits away like some states are doing.
That just punishes Americans who've been struggling for 14 months
already. Public officials must instead hold hospitality companies
accountable and fight against a jobless recovery by making Federal
assistance conditional on recipients rehiring their long-time workers
with good wages and benefits.
UNITE HERE members are fighting to defend our jobs, and that's
where workers need your leadership and your support. Thank you.
______
Appendix A: Supplementary Statements from Hospitality Workers
1. Barbie Tivas: Station Casinos, Las Vegas, NV
My name is Barbie Lee Tivas and I have worked at Green Valley Ranch
Resort Spa and Casino as a banquet server for 13 years. I have invested
time, blood, sweat, and tears during my 13 years with Station Casinos.
My work helped to further their profits in the good and bad times. I
don't want to be abandoned when their businesses recover.
Over the past 7 months, I have had to squeeze my finances and just
pay for the bare minimum like groceries, gas, and utilities. I was also
able to get a forbearance on my mortgage, thank God, which has really
helped my family. I am 54 years old and I do not want to lose my job at
this age after so many years of working hard. I'm proud of the work I
do and I help my company to be successful. Every single one of my
coworkers and I should have the opportunity to return back to work when
the economy recovers. I have hope that things will be normal again, and
when they are, I don't want to be left behind.
2. Fernando Herrera: United Catering, Houston, TX
My name is Fernando Herrera, and I have been a transportation
driver at United Airlines catering for 20 years. I was shocked to hear
that United is planning on subcontracting out the kitchen--United has
not really informed us about anything. Right now, we don't know what to
do or how to prepare.
It is an injustice. It's not fair that United even after getting
the money from the government, is considering laying people off. That's
all me and my coworkers think about. I am the sole provider for my wife
and son, so this news affects my whole family. I don't know what my
family and I will do or if I'll be able to find work after 20 years at
the same job.
I'm scared most about losing my healthcare. I had a heart attack in
2016 and had to be out of work for four months after my surgery. My
healthcare is really important to me to be able to stay healthy, and I
fear what will happen if in a few months, I lose my job and my health
insurance.
3. Judith Ramirez: Marriott, Honolulu, HI
My name is Judith Ramirez, and I've worked at the Sheraton Waikiki
in Honolulu, HI for three years. It's scary to think that Marriott
might not call me back to work if there is no more daily room cleaning.
If there are fewer rooms to clean, there will be fewer jobs for
housekeepers.
Losing my job wouldn't hurt only me, it would hurt my whole family.
I have two young children to feed. Without my job, I can't afford to
put food on the table, pay the mortgage, or help my family in the
Philippines. The housekeepers in my hotel are almost all women of
color, and most of the other jobs we have found have lower wages and
unaffordable health care. Housekeepers have fought hard to make our
jobs better, and we don't want to lose them.
Senator Rosen. The microphone--Thank you, Mr. Taylor for
your insights into the hospitality workforce and into our
States and important cities.
And so now, I would like to turn it over to Senator Scott
to introduce our next witness. Senator Scott.
Senator Scott CEO of Florida Attractions. He represents
over 120 theme parks and tourist attractions in Florida. He
is--I had the pleasure to work with Bill when I was Governor.
He and a lot of others, they bring a lot of visitors to our
state. So, welcome, Bill. I look forward to hearing from you.
STATEMENT OF BILL LUPFER, PRESIDENT AND CEO, FLORIDA
ATTRACTIONS ASSOCIATION
Mr. Lupfer. Thank you, Senator. Good afternoon Chairwoman
Rosen and Ranking Member Scott, and members of the
Subcommittee. I want to thank you for your leadership in
addressing the pandemic's devastating economic damage,
specifically to the Nation's hardest hit sector, travel and
tourism. I am honored to participate in this hearing on
Investigating America's Tourism and Hospitality Workforce and
Small Business.
Founded in 1949, the Florida Attractions Association, or
the other FAA, is Florida's trade association representing the
tourist attraction industry. Florida's heritage as a
vacationland has evolved through the decades. As our state's
natural wonders continue to attract visitors from around the
world, our state's manmade attractions have evolved from
kitschy roadside attractions to now include the world's most
popular theme park destinations.
Today, the FAA is comprised of 250 member businesses. The
state's largest attractions are members, however, most of our
members are small businesses. Only 10 percent of our members
are publicly traded companies. Many of our members represent
3rd and 4th generation owner/operators of their family's
attractions. And forty percent of our members have an annual
paid attendance of under 100,000 guests.
Florida's non-essential businesses, including our
attractions, closed around March 15 of last year. During this
time, the actions of Congress to provide support and relief to
small business was a great help. The CARES Act, the Paycheck
Protection Program, and SBA's Economic Injury Disaster Loans
were the bridge needed to maintain an employee base and cover
ongoing expenses through the closure.
Governor DeSantis began the process of reopening Florida's
businesses and a pathway to reopen Florida's tourism economy,
including attractions, by an Executive Order on May 18, 2020.
The Florida Attractions Association worked with our members and
their respective county governments to define best practices in
a tourist attraction environment to provide protection for
guests and employees from viral transmission. The objective was
clear and the goal unmistakable--eopening safe, smart and step-
by-step.
As the industry began to reopen, there was initially a
trepid response from travelers needing assurance that their
safety was paramount to our industry. As the summer of 2020
progressed, Florida experienced a staycation season as
Floridians travelled to other Florida destinations, often
within a day's drive of their homes. Outdoor facilities were
particularly popular, as National Parks, State Parks and
outdoor attractions, such as zoos and gardens, had the benefit
of providing guests fresh air and sunshine.
Over the last year, the general pattern has developed, as
the public's trust in travel returns, confidence in safety
protocols proven, and the desire to get out and go inspired
Americans to travel once again. Florida has seen an increasing
return of the domestic traveler, and while it is not at pre-
COVID levels, it is encouraging to see attractions, hotels,
campgrounds, and restaurants begin to experience recovery. Our
state's tourism marketing office, Visit Florida, reported a 14
percent decline in travel in Florida in the first quarter of
2021, compared to 2020.
What we need, number one, clear policy coordination between
agencies such as the CDC, Department of Transportation, OSHA,
and other public-facing agencies with timely guidance on
defeating the pandemic. Recent changes in the CDC's guidance
were a welcome development to our members. However, the
swiftness of the changes left many businesses scrambling to
interpret the new guidance and assess the impact on their
businesses. Even today, guidance from the CDC, Department of
Transportation and OSHA could be viewed as being conflicting.
Number two, Florida and much of the Nation is experiencing
a labor shortage and it is acute in Florida's hospitality
industry. We know that many of our members are experiencing
this, in part, because of the continued payment of state
unemployment insurance benefits and Federal unemployment relief
programs. Governor DeSantis has directed the state to
discontinue waiving the work search requirement at the end of
this month. And Florida will stop--will step out of the
Florida--of the Federal Pandemic Unemployment Compensation
program at the end of next month.
Entry level labor shortages are not new. In 19--by 2029,
only 28 percent of teens will participate in the U.S. labor
force, down 43 percent from 1978. The shortage is driving up
wages, supply and demand, business must adapt as they compete
for talent. But one amusement park has discovered that even
wages are not the answer, this year offering a 100 percent
increase, from $10 to $20 per hour, and still having to reduce
operating hours and close due to labor shortages.
And number three, as discussed in your last hearing, the
cruise industry, an industry I have no direct, professional
role in, is still waiting for clear guidance from the CDC. The
cruise industry and the attraction industry are fierce
competitors, but we need each other to achieve our individual
and collective business objectives.
Addressing these issues, along with your support of Brand
USA, will help us move our tourism economy forward, prepared
for a post-pandemic success. Thank you for your leadership in
supporting America's hospitality workers and small business. I
look forward to working with you and answering your questions.
Thank you.
[The prepared statement of Mr. Lupfer follows:]
Prepared Statement of Bill Lupfer, President and CEO,
Florida Attractions Association
Good afternoon Chairwoman Rosen, Ranking Member Scott, members of
the Subcommittee. I thank you for your leadership in addressing the
pandemic's devastating economic damage, specifically to our Nation's
hardest hit sector, travel and tourism. I'm honored to participate in
this hearing on Investing in America's Tourism and Hospitality
Workforce and Small Businesses.
About the Florida Attractions Association
Founded in 1949, the Florida Attractions Association, or ``the
other FAA'' is Florida's trade association representing the tourist
attractions industry. Florida's heritage as a vacationland has evolved
through the decades. As our state's natural wonders continue to attract
visitors from around the world, our state's manmade attractions have
evolved from kitschy roadside attractions to now include the world's
most popular theme park destinations.
Today, the FAA is comprised of 250 member businesses. The state's
largest attractions, Walt Disney World, Universal Orlando Resort,
SeaWorld Parks and Merlin Entertainments are members; however, most of
our members are small businesses. Only 10 percent of our members are
publicly traded companies. Many of our members represent 3rd and 4th
generation owner/operators of their family's attractions. Forty percent
of our members have an annual paid attendance of under 100,000 guests.
The Florida Attractions Association links the passion and
creativity of Florida's attractions industry. We provide leadership
training and professional development, advocacy, networking and
communication channels as we promote and protect the interests of the
Florida Attractions industry and connect our Attraction members to each
other and industry thought leaders.
Florida Attraction Association's Pandemic Response
Florida's non-essential businesses, including our attractions,
closed around March 15, 2020. The uncertainty of the virus, its methods
of transmission, and consequences to vulnerable populations were
unknown. As we moved from ``15 days to slow the spread'' to 30 days to
``flatten the curve'' we collected the best information available to
share with our members.
In April 2020, the Florida Attractions Association published for
its members a Guide for Reopening Florida Attractions. Creating
reopening protocols for our industry was a challenge. As most business
types share similarities in their operation--hotels, restaurants,
campground, retail stores, for example, each attraction is unique.
Consider these types among our members--Adventure Parks, Agritourism,
Airboat Ride, Alligator Farms, Amusement Parks, Aquariums,
Archaeological Park, Boat Cruises, Canoes, Kayak, Cycling Rentals,
Destination Resorts, Dinner Theaters, Drive-through Safaris/Animal
Parks, Family Entertainment Centers, Farms, Gardens, Go-Karts, Karting,
Historic Sites/Homes/Lighthouses, Iconic Wheel, Indoor Flying, Marine
Parks, Off-road adventure courses, Open-air trains and trolleys,
Science Centers, Space Center, Springs, Swamp Buggy Rides, Theme Parks,
Trampoline Parks, Waterparks, Zip Lines, and Zoos.
In a tourism economy and an attraction environment, these protocols
require unique approach to ensure the safety of our guests and
employees.
During this time, the actions of Congress to provide support and
relief to small businesses was a great help. The Paycheck Protection
Programs and SBA's Economic Injury Disaster Loans were the bridge
needed to maintain an employee base and cover ongoing expenses through
the closure.
Governor DeSantis began the process of reopening Florida's
businesses and a pathway to reopen Florida's tourism economy, including
attractions, by an Executive Order on May 18, 2020.
The Florida Attractions Association worked with our members and
their respective county governments to define best practices in a
tourist attraction environment to provide protection for guests and
employees from viral transmission. The objective was clear and the goal
unmistakable--reopening safe, smart and step-by-step.
Reopening Florida Attractions
As the industry began to reopen, there was initially a tepid
response as travelers needed assurance that their safety was paramount
to our industry. As the summer of 2020 progressed, Florida experienced
a ``staycation'' season as Floridians travelled to other Florida
destinations, often within a day's drive from their homes.
Outdoor facilities were particularly popular, as National Parks,
State Parks and outdoor attractions such as zoos and gardens had the
benefit of providing guests fresh air and sunshine.
Over the last year, a general pattern has developed, as the
public's trust in travel returns, confidence in safety protocols
proven, and the desire to ``get out and go'' inspired Americans to
travel once again. Florida has seen an increasing return of the
domestic traveler, and while it's not at a pre-COVID levels, it is
encouraging to see attractions, hotels, campgrounds and restaurants
begin to experience recovery. Our state's tourism marketing office
reported a 14 percent decline in travel to Florida in the first quarter
of 2021 compared to 2020.
Ultimately, the full recovery will be realized with the return of
two market segments. First, the international traveler. In your hearing
last Tuesday, you heard expert testimony from three industry
professionals. It was clear this subcommittee recognizes the unique
characteristics of the international traveler. Emergency funding of
Brand USA to stimulate international travel will reap broad benefits
for America's economy. Second, the return of the business traveler. The
Meetings and Convention industry has been severely impacted, but we are
now seeing a slow return of that market segment.
What We Need
Clear policy coordination between agencies such as the CDC,
Department of Transportation, OSHA and other public-facing
agencies with timely guidance on defeating the pandemic is
needed. Recent changes in the CDC's guidance were a welcome
development to our members. Those who have chosen to receive
vaccines should have more freedom and flexibility. However, the
swiftness of the changes left many businesses scrambling to
interpret the new guidance and assess the impact on their
businesses. Even today, guidance from the CDC, Department of
Transportation and OSHA can be viewed as conflicting.
Florida and much of the Nation is experiencing a labor
shortage and it is acute in Florida's hospitality industry.
There are many facets to this problem and I'm not an expert on
the labor economy. We know that many of our members are
experiencing this in part because of the continued payment of
state unemployment insurance benefits and Federal unemployment
relief programs (FPUC and American Rescue Plan). Though
anecdotal, former employees are specifically stating this as a
reason for not returning to work. Fortunately, Governor Ron
DeSantis has directed the Florida Department of Economic
Opportunity to discontinue waiving the work search and work
registration requirements on May 29, 2021. Reigning in of the
Federal program with work search requirements will assist us
with our collective efforts to get America back to work.
As discussed in your last hearing, the cruise industry--an
industry I have no direct, professional role in--is still
waiting for clear guidance from the CDC. The cruise industry
and the attraction industry are fierce competitors--attractions
desiring to keep travel dollars in Florida, the cruising
industry sending travel dollars to other cruise destinations,
but we need each other to achieve our individual and collective
business objectives.
Addressing these issues, along with your support of Brand USA will
help us move our tourism economy forward, prepared for post-pandemic
success. Thank you for your leadership in supporting America's
hospitality workforce and small businesses. I am happy to answer your
questions.
Senator Rosen. Thank you, Mr. Lupfer. Testifying next is
Shaundell Newsome, Chairman of the Las Vegas Urban Chamber of
Commerce. Mr. Newsome is a 10-year veteran of the U.S. Air
Force and a small business owner for the past 15 years. Through
both his personal work and the Urban Chamber of Commerce, Mr.
Newsome connects small business owners with the resources and
access they need to both regional and global markets.
Mr. Newsome, you are recognized for your opening remarks.
STATEMENT OF SHAUNDELL NEWSOME, CHAIR, URBAN CHAMBER OF
COMMERCE LAS VEGAS
Mr. Newsome. Thank you, Madame Chair and members of the
Senate subcommittee, good afternoon. Again, my name is
Shaundell Newsome, a Nevada small business owner and founder of
Sumnu Marketing, a firm in partnership with my wife Arlene, and
my daughter Tiara. In 2015, we were recognized as SBA Nevada
Family Owned Business of the Year. Currently, I chair the Las
Vegas Urban Chamber of Commerce, Co-Chair Small Business for
America's Future, serve as a Trustee for the Las Vegas Chamber
of Commerce, and Co-Chair for the Henderson Chamber's Issues
Committee. So, I am extremely engaged and involved in my small
and minority business community.
Today, I am here to speak directly to Investing in
America's Tourism and Hospitality Workforce and Small Business.
And I want to thank Senator Rosen, a true small business
champion, for this opportunity to address you.
After serving a decade in the military, I worked for a
gaming and hospitality family owned small business, Station
Casinos, in Nevada as a Marketing Director. This is where I
connected the dots between workforce and small businesses. Not
only did we hire thousands of employees with growth, but our
local small businesses also benefited from our needs to procure
products and services. We purchased balloons, t-shirts,
signage, and many products and services from local small
business vendors.
The Las Vegas Strip casinos produce many jobs and
procurement opportunities for small businesses. But I know that
many of you outside of Nevada may not realize that there are
small casino operators like Henderson's Rainbow and Emerald
Island, with my friend Tim Brooks as the owner. And the Poker
Palace, owned by Mickey and Laura Coleman in North Las Vegas.
They have served the community since even before I arrived in
1987 to Nellis Air Force Base. Yes, I know these small business
owners personally. Despite being the Entertainment Capitol of
the World and a global destination, Las Vegas and in particular
Southern Nevada is a small tight community.
When one business in a tight community feels a burden, we
all feel a burden. The impact of a decrease in business and
leisure travel is felt from our major corporations to the
smallest Main Street companies. Contracts for my company and
many others were either delayed or cancelled immediately
causing instant closures and much uncertainty. Small business
owners had to reach into our bag of innovative tricks to
survive.
School and daycare closures put our employees in a bad
position. Once we were clear to open again with social
distancing, our firm decided to create office space for
children to attend school remotely, giving their parents
comfort and peace of mind. The new normal meant that we had to
be flexible with team members working remotely, with
alternating days in the office to keep everyone safe. We
followed the science and survived with no major concerns.
Investing in America's Tourism and Hospitality Workforce
and Small Business is a safe bet, pun intended, for this
country. I implore this committee to double down on the recent
successful American Rescue Plan, by investing in America's
Tourism and Hospitality Workforce and Small Businesses, to
rebuild our economy. In addition, we should all push all of our
chips to the middle of the table on the American Jobs Plan to
rebuild our infrastructure and create necessary job
opportunities for individuals and contracts for small
businesses.
Thank you very much for realizing the importance of the
tourism, travel, and hospitality industry, and small
businesses. We are all winners when we invest wisely this way.
Thank you very much.
[The prepared statement of Mr. Newsome follows:]
Prepared Statement of Shaundell Newsome, Founder/Visionary,
Sumnu Marketing
Madame Chair and members of the senate subcommittee,
Good evening. My name is Shaundell Newsome, a Nevada small business
owner and founder of Sumnu Marketing, a firm in partnership with my
wife Arlene and my daughter Tiara. In 2015 we were recognized as SBA
Nevada Family-Owned Business of the Year.
Currently, I chair the Urban Chamber of Commerce Las Vegas Board of
Directors, Co-Chair Small Business for America's Future, serve as a
Trustee for the Las Vegas Chamber of Commerce and Co-Chair for the
Henderson Chamber's Issues Committee. So, I am extremely engaged and
involved in my small and minority business community.
Today, I am here to speak directly to Investing in America's
Tourism and Hospitality Workforce and Small Business. And I want to
thank Senator Rosen, a true small business champion for this
opportunity to address you.
After serving a decade in the military, I worked for a gaming and
hospitality family-owned small business, Station Casinos in Nevada as a
Marketing Director. This is where I connected the dots between
workforce and small businesses. Not only did we hire thousands of
employees with growth, but our local small businesses also benefitted
from our needs to procure products and services. We purchased balloons,
t-shirts, signage and many products and services from local small
business vendors. The Las Vegas Strip casinos produce many jobs and
procurement opportunities for small companies. But I know that many of
you outside of Nevada may not realize that there are small casino
operators like Henderson's Rainbow and Emerald Island with my friend
Tim Brooks as an owner. And the Poker Palace owned by Mickey and Laura
Coleman in North Las Vegas has served the community since even before I
arrived in 1987 to Nellis AFB. Yes. I know these small business owners
personally. Despite being the Entertainment Capitol of the World and a
global destination, Las Vegas and in particular Southern Nevada is a
small tight community.
When one business owner in a tight community feels a burden, we all
feel a burden. The impact of a decrease in business and leisure travel
is felt from our major corporations to the smallest main street
companies. Contracts for my company and many others were either delayed
or canceled immediately causing instant closures and uncertainty. Small
business owners had to reach into our bag of innovative tricks to
survive. School and daycare closures put our employees in a bad
position. Once we were clear to open again with social distancing our
firm decided to create office space for children to attend school
remotely, giving their parents comfort and peace of mind. The new
normal meant that we had to be flexible with team members working
remotely with alternating days in the office to keep everyone safe. We
followed the science and survived with no major concerns.
Investing in America's Tourism and Hospitality Workforce and Small
Business is a safe BET, pun intended, for this country. I implore this
committee to DOUBLE DOWN on the recent successful American Rescue Plan
by investing in America's Tourism and Hospitality Workforce and Small
Businesses to rebuild our economy. In addition, we should PUSH ALL OF
OUR CHIPS TO MIDDLE OF THE TABLE on the American Jobs Plan to rebuild
our infrastructure and create necessary job opportunities for
individuals and contracts for small businesses.
Thank you very much for realizing the importance of the tourism,
travel and hospitality industry and small businesses. We are all
WINNERS when we invest wisely this way.
Senator Rosen. Well, thank you, Mr. Newsome for your
remarks on tourism and small business, the nexus between the
two.
So, Senator Scott, I am going to turn it over to you to
introduce our fourth and final witness, please.
Senator Scott. Thank you, Chair Rosen. Drew Daly, Senior
Vice President of Dream Vacations World Travel Holdings is here
today to represent--and represents World Travel Holdings. He
began working for the company as a travel agent. Now, he runs
their Dream Vacations' CruiseOne and Cruise, Inc. divisions. He
also serves on the Starboard, which is the steering committee
for the Cruise Lines International Association. Welcome, Drew.
STATEMENT OF DREW DALY, SENIOR VICE PRESIDENT AND GENERAL
MANAGER, CRUISEONE, DREAM VACATIONS AND CRUISES INC.
Mr. Daly. Thank you, Senator Scott. Chairwoman Rosen,
Ranking Member Scott, and members of the Subcommittee, thank
you for your efforts to bring attention to the devastating
economic impact suffered by the countless travel and tourism
industry workers and small businesses across the U.S. due to
the pandemic. It is a true honor and privilege to represent
World Travel Holdings, Dream Vacations Travel Advisors, and the
broader travel advisor community across the United States.
Travel agents do in fact exist, and over the years, they
have evolved into travel advisors. Travel advisors play a
critical role in working with clients to plan travel for
business and leisure purposes. Today, the entire travel
industry comprises tens of thousands of travel advisors who are
running their own businesses. The majority of them work from
home and are, literally, building their business in their
neighborhoods, backyards, and in their communities.
At Dream Vacations, we support thousands of small business
owners around the country, who took a chance and had a dream to
start a business and create something that was their own. Some
have been doing it for more than 30 years and, believe it or
not, quite a few started their business in the midst of the
pandemic.
All travel advisors earn a living based on what they sell
their customers, and they get paid when their customers
actually travel. One tourism sector that is especially
important to travel advisors is the cruise industry. Seventy-
eight percent of all cruise vacations are booked by a travel
advisor in the industry and cruise accounts for a large portion
of their business. More than 70 percent of the cruise bookings
made today are set to depart in 2022 or later, which means
these businesses will not get paid, largely, for another year.
Despite industry leading protocols and proving sailings in
other regions of the world, it has been almost 16 months since
cruise ships departed from U.S. ports, ultimately impacting the
livelihood of tens of thousands small business owners during
that time. Cruise is the only travel and tourism sector in the
United States still shut down.
Thank you so much for your support in the passage, last
week, of the Alaska Tourism Restoration Act. And we were
thrilled to see yesterday's signing of the bill by President
Biden. Alaska is a critical cruise market, not just in terms of
cruise bookings, but also, the jobs supported by the cruise
passengers that visit the state.
My written testimony outlines the devastating impact to the
travel industry, but here are a few statistics, specifically.
The reduction in travel caused by COVID-19 resulted in a $500
billion loss in travel spending across the United States in
2020, with 5.6 million travel-supported jobs lost, accounting
for 65 percent of all jobs lost in the country. For the cruise
industry, it represents $39 billion in total economic losses,
including the loss of 300,000 jobs along with $16.5 billion in
wages.
We have seen a number of our travel advisors shift gears
and do their best to make a living during this downturn.
Specifically in Florida, one of our top franchisees, who has
been in business for 30 years, had to go back and become a
school nurse. And another went and got a job at a local grocery
store. In Nevada, one resorted to becoming an Uber driver, and
to be delivering Uber Eats, just to put food on the table. In
Washington State, we have several franchises partner with local
businesses in their communities, to do virtual wine tasting
events, just so they can maintain relevance in their customers'
mindset, while they could not travel.
Congress can help the travel and tourism sector recover by
enacting policies to spur travel demand and support workers who
are not yet fully participating in our country's economic
recovery. We are so grateful for the strong economic support
provided by the CARES Act, and subsequent relief packages
approved by Congress. Relief packages like the Paycheck
Protection Program provided much needed lifelines to many of
these small businesses and workers, in the travel and tourism
sector.
Every week, my team and I have individual conversations
with small business owners and the stories that we hear are
truly heartbreaking, as families? livelihoods are on the line.
Because travel agents do not earn an income until their
customer travels, we anticipate that many travel advisors could
suffer financial hardship for the next year, as they continue
to book in the future. With the Paycheck Protection Program set
to expire in May, I ask that you consider extending targeted
relief programs for sectors that will take longer to recover.
Finally, the return of cruising out of the U.S. is a vital
step. The biggest hurdle now, for the continued success of our
travel advisors, is for cruising and all forms of travel to
come back full throttle.
Thank you again for the opportunity to testify today on
behalf of the entire travel advisor community. Your efforts to
support the rebuild and recovery for travel and tourism and the
many small businesses that are critical to the sector, are
greatly appreciated. I promise, travel advisors are certainly
going to play a key role in helping get Americans traveling
again and boosting economic recovery across the entire country.
We need to ensure that these businesses and their workers can
survive the remaining challenges presented by the pandemic
overall.
Thank you and I look forward to hearing your questions.
[The prepared statement of Mr. Daly follows:]
Prepared Statement of Drew Daly, Senior Vice President and General
Manager of CruiseOne, Dream Vacations and Cruises Inc.
Chairwoman Rosen, Ranking Member Scott, and Members of the
Subcommittee, thank you for holding this important hearing, and for
your efforts to bring attention to the devastating economic impact
suffered by the countless travel and tourism industry workers and small
businesses across the United States due to the COVID-19 pandemic.
My name is Drew Daly, and I am the Senior Vice President and
General Manager of CruiseOne, Dream Vacations and Cruises Inc.
(hereinafter collectively referred to as ``Dream Vacations''), which is
part of World Travel Holdings, the Nation's largest cruise agency and
award-winning leisure travel company. Dream Vacations is a low-cost,
low-investment homebased travel agency franchise with several thousand
franchise owners nationwide. We provide our network of travel advisors
with the resources they need to own and operate a small business and
make it successful in the long term.
As we build our network across the United States, we strive to
promote diversity and support veterans. Recognizing that the skills
veterans learn in the military translate well into business ownership,
Dream Vacations is committed to recruiting military veterans and their
spouses. We are the only travel advisor franchise to have a ``5-Star
Ranking'' as a member of the International Franchise Association's
VetFran initiative. More than 35 percent of our travel advisor network
consists of military veterans or active-duty spouses. In addition,
approximately 70 percent of our travel advisor franchises are women-
owned. Running a Dream Vacations travel advisor franchise is a popular
career path for ``mompreneurs'' and stay-at-home parents because they
have the flexibility to set their own hours to revolve around family
schedules.
Travel Advisors Make Travel Happen
On behalf of Dream Vacations' travel advisors, World Travel
Holdings, and the broader travel advisor community across the United
States, I am pleased to participate in today's hearing. Travel agents
do in fact exist, and over the years, we have evolved into travel
advisors. Travel advisors play a critical role in working with clients
to plan travel for business and leisure purposes, delivering
exceptional customer service.
Travel advisors earn a living based on what they sell to their
customers and get paid on the actual departure. We book vacation
packages, hotels, car rentals, tours and excursions, airline tickets,
and many other components of the travel journey. We truly are focused
on ensuring that consumers and travelers maximize their investment and
receive the best experience that suits their needs. One travel and
tourism sector that is especially important to Dream Vacations, World
Travel Holdings, and our travel advisors is cruise. Seventy-eight
percent of all cruises are booked by a travel advisor, and largely 75
percent of the business that comes through the doors of these small
business owners is from cruise.
Today, more than 70 percent of our cruise bookings are for 2022
departures. Despite industry leading protocols and proven sailings in
other regions of the world, it has been almost 16 months since cruise
ships departed from U.S. ports. Although we do see hope for a restart
of cruise on the horizon, tens of thousands of small business owners in
the cruise community have been directly impacted by the suspension of
cruise operations and without revenue for 16 months. The biggest hurdle
now for the continued success of our travel advisors is for cruising
and all forms of travel to come back full throttle.
We were pleased to see passage last week of the Alaska Tourism
Restoration Act introduced by Senator Lisa Murkowski (R-AK), Senator
Dan Sullivan (R-AK), and Representative Don Young (R-AK). This removes
a barrier to the restart of cruises in Alaska by temporarily waiving
the requirement of the Passenger Vessel Services Act for Alaska cruises
departing from Washington State to stop in Canada for the duration of
Canada's ban on cruise ships in its waters. Alaska is a critical cruise
market, not just in terms of cruise bookings, but also the jobs
supported by the cruise passengers that visit the state. We greatly
appreciate the work of the Senate Commerce Committee and Alaska's
Congressional Delegation in supporting the resumption of cruise
operations, and our hope is that cruises will be able to sail from U.S.
ports this July.
Devastating Impacts of COVID-19
Travel advisors play a critical role in advocating on behalf of
their customers. Like an attorney or financial advisor, they have a
fiduciary duty to do what is best for their clients, while ensuring
they are protected when traveling should any challenges arise along
their journeys. As you can imagine, the COVID-19 pandemic certainly
highlighted this important work. Travel advisors worked around the
clock to make alternative arrangements to bring stranded Americans home
from far away destinations when international borders began to close.
While travel advisors remained busy at the beginning of the COVID-19
pandemic helping clients adjust travel plans, new business quickly
disappeared as Americans and the rest of world abruptly stopped
traveling.
The resulting devastation felt across the entire travel and tourism
industry was unimaginable. According to the U.S. Travel Association,
the reduction in travel caused by COVID-19 resulted in a $500 billion
loss in travel spending across the United States in 2020, with 5.6
million travel-supported jobs lost, accounting for 65 percent of all
jobs lost in the country.\1\ Specific travel sectors, such as cruise,
have been hit particularly hard. According to the Cruise Lines
International Association, the cruise industry in the United States has
suffered $39 billion in total economic losses, including the loss or
significant reduction of work of more than 300,000 jobs along with
$16.5 billion in wages, since voluntarily suspending operations in
March 2020. Cruise is the only travel and tourism sector in the United
States still shut down, although discussions with the U.S. Centers for
Disease Control and Prevention toward the restart of cruises from U.S.
ports remain underway.
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\1\ https://www.ustravel.org/system/files/media_root/document/
Research_Fact-Sheet_Industry
-Table.pdf
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We have seen a number of our travel advisors shift gears and do
their best to make a living during this downturn. In Florida, several
locations unfortunately closed their doors and others who have resorted
to other sources of income. For example, one of our top producing
franchisees nationwide and a Florida resident had to go back to being a
school nurse to earn an income, while another franchisee started
working in a local grocery store. In Nevada, we saw a franchisee become
an Uber driver to provide for some money coming in so they can put food
on the table for their families. An agency in Washington state started
hosting virtual wine tasting events and partnering with other local
businesses so they can provide experiences to their customers and
maintain relevance.
While we are optimistic about the prospect of a return to normalcy
as the public health environment in the United States continues to
improve with widespread vaccination and with many Americans now ready
to make plans for summer vacations, the reality is that the recovery
will not happen overnight. The U.S. Travel Association expects that it
will take the travel and tourism sector five years to fully recover
from the losses experienced during the COVID-19 pandemic. My sincere
hope is that the recovery will not take that long.
Congress Can Help Recover Travel Demand
Congress can help the travel and tourism sector recover by enacting
policies to spur travel demand and support workers who are not yet
fully participating in our country's economic recovery. While many
Americans are now ready to travel again, others may still be hesitant
or may be recovering from the economic toll of the pandemic. The
economic impact has been unequal across sectors and regions in our
country. Many Americans that would welcome the opportunity to travel
simply may be unable to because of the financial hit they have suffered
over the last year. Providing temporary targeted relief that encourages
Americans to travel could boost demand, allow travel providers to hire
back workers, and speed up the recovery of our sector.
Many workers and businesses in the travel and tourism community,
including our travel advisors, are grateful for the strong economic
support provided by the Coronavirus Aid, Relief, and Economic Security
(CARES) Act, and subsequent relief packages approved by Congress.
Relief programs like the U.S. Small Business Administration's Paycheck
Protection Program (PPP) provided much needed lifelines to many small
businesses and workers in the travel and tourism sector that suffered
catastrophic business losses because of the pandemic. However, many
others were unable to qualify for the programs. Because travel advisors
make money on departures, we have many new small business owners who
have made sales but have not yet earned anything. Since they had no
income at the time, they did not qualify for CARES Act relief funding.
Every week my team has individual conversations with small business
owners about staying motivated and focused on the future as we know it
is going to be brighter. However, the stories that we hear are truly
heartbreaking as families' livelihoods are on the line. Because travel
agents do not earn an income until travelers travel, we anticipate that
many travel advisors could suffer financial hardship for the next year
as they continue booking future travel. Given these challenges, many
travel advisors still need help. With the PPP set to expire in May, I
ask that you consider extending targeted relief programs for sectors
that will take longer to recover.
Closing Summary
Thank you again for the opportunity to testify before the
Subcommittee today. On behalf of the travel advisor community, your
efforts to support the recovery travel and tourism and the many small
businesses that are critical to the sector are greatly appreciated.
Travel advisors are certainly going to play a key role in helping get
Americans traveling again, boosting economic recovery across the United
States. We need to ensure these businesses and their workers can
survive the remaining challenges presented by the COVID-19 pandemic. I
look forward to your questions.
Senator Rosen. Well, thank you, Mr. Daly, and again, I want
to thank all of our witnesses for joining today and for their
thoughtful opening statements.
So, I am going to start it off with a question to Mr.
Newsome about small businesses, and then, move on to Mr. Taylor
to talk a little bit about our hospitality work force.
So, over the past year, Nevada's small businesses,
particularly the businesses who depend on our tourism and
hospitality industry for their customers, of course, we know
they struggle to keep their doors open, due to COVID-19. In
response, Congress passed numerous small business support
programs, Paycheck Protection Program, the Restaurant
Revitalization Fund. Those help small businesses stay afloat
and keep their workers on the payroll. Unfortunately, PPP ran
out of funds on May 4th and just yesterday, the Restaurant
Revitalization Fund stopped taking new applications.
With hospitality and tourism being slower to recover than
other industries, additional limited, targeted relief may be
needed until business and leisure travelers, in both the U.S.
and abroad, have the confidence to travel once again.
So, Mr. Newsome, as the tourism and hospitality industry
slowly recovers from the economic impacts of this public health
crisis, what additional support do you think Congress could
provide to our small businesses, and what investments, do you
think, we might make broadly going forward? We want a healthy
recovery, and we want a robust one and we want to support
everything that you are working on.
Mr. Newsome. Well, thank you very much, Senator Rosen. One
of the things that I think is real important is continuing to
provide access to capital, to small and minority businesses. As
we know, systemically, that has been a challenge, especially
for most of our minority owned firms. We found that, even prior
to the pandemic, it was very, very difficult to get access to
capital. Opening up CDFIs and opening up alternative lending
resources, have been very beneficial to small businesses.
The other thing is broadband. As you know, in Nevada, we
have a lot of rural businesses. And really, you know, they have
a challenge with some of these Zoom calls and different
opportunities to do business online. So, I think that is
extremely important. And one of the things--the other thing
that I mentioned was childcare. I know that a lot of my--you
know, my employees and people who are members of the Chamber,
they were not only challenged with going back to work--a lot of
the employees were not just challenged with any funding from a
package or from unemployment, but a lot of them were struggling
with childcare.
Senator Rosen. Right.
Mr. Newsome. And what do they do with their children to
keep them safe. So, I would say that those are--those are one
of the crucial, but for--in particular, for small business
owners, continue to fund the small business development
centers. Continue to fund the resources that help small
businesses to--small business owners, to become better
operators of their business.
I was fortunate to spend time in the military. I was
fortunate and blessed to work in gaming and hospitality. And I
learned a lot from those industries. Not everybody has that
opportunity. So, I think that is a--that is a great opportunity
there.
And then, the last thing that I would say is real important
is, the healthcare cost. It is really important that we help
small businesses have an opportunity to provide affordable
healthcare for their employees, as well as, you know, try to
defray the cost. And make sure that we are not spending all of
our money on healthcare, where we should be providing most of
the money to our employees and helping to provide better
services to our clients and our customers.
So, I think what is important is, do not forget small
businesses. The small businesses are the backbone of this
country. We bring people back to work faster. We do a lot, so
we do appreciate what has happened. But there is a lot more to
be done. Thank you.
Senator Rosen. Well, that is a good segue, thank you, to
Mr. Taylor because, earlier this year, we--American Rescue Plan
covered--Senator Cortez Masto and I worked diligently to be
sure that 100 percent of COBRA insurance was covered during the
pandemic. People lost their job, through no fault of their own,
and we really secured that. We know how important it was to our
Culinary Workers' Union, to all the union members, and just
workers across this country.
So, just a few seconds I have left. We will go into a
second round, of course. Can you talk about the impact that
fully subsidized COBRA health benefits had on our members in
the hospitality and tourism industry?
Mr. Taylor. Yes, Senator Rosen. I think that that is one of
the keystones of what has helped people survive. The 100
percent COBRA subsidy is going to allow members to get back on
health insurance. In our industry--in the--basically, a lot in
the hospitality industry, only 23 percent of employers continue
to provide healthcare benefits. So, in the middle of a
healthcare pandemic, we had people losing healthcare.
So, this has been a huge plus under the American Rescue
Plan. We are enrolling people now. It is for 6 months. And,
bluntly, if I was looking ahead about what Congress can do, is
even if people are returning to work, they often have to
requalify for healthcare. Continuing the (inaudible) helps both
small and large business, right now, because I (inaudible)
right when we were shut down, right in the middle of a
healthcare pandemic, we had people losing healthcare. That
seems counterintuitive to just basic reason.
I cannot think of anything more impactful that came under
the American Rescue Plan, than the 100 percent COBRA subsidy.
Senator Rosen. Well, thank you, Mr. Taylor. Senator Cortez
Masto and I were glad to work on that. So, Senator Scott, you
are recognized.
Senator Scott. Great. Thank you, Chair Rosen. So, Mr.
Lupfer, can you talk about--we have heard, I think, from Mr.
Taylor and Mr. Newsome, some of the challenges that they have
had with labor shortages. Can you talk about some of the issues
that your industry has had with labor shortages?
Mr. Lupfer. Yes, thank you, Senator. Labor shortages is not
an issue that is new to us in Florida. The tourism industry has
grown tremendously, as population has grown. But a lot of the
population growth we have seen in Florida is retirees. I think
it is interesting, Senator, that when you were Governor, you
doubled--you increased tourism promotion funding by 50 percent,
and we ended up netting a 50 percent increase in visitation to
the State of Florida. So, certainly, the economics continuing
to drive visitors to the Sunshine State, has put even more
strain on the labor market.
It also has affected wages. You know, the minimum wage is
not something that is even talked about anymore. Florida's
employers are paying significantly more than minimum wage. One
of the things that is particularly interesting is the fact that
teens are less and less inclined to participate in summer jobs.
And you know, traditionally in America, summertime was the time
when you go back, and you get the job and earn a few bucks and
learn some skills and accept some responsibility. But there is
some interesting statistics from the Bureau of Labor Statistics
that demonstrate that less and less teens are participating in
the labor force.
Another thing that is affecting us right now is the
inability for the Department of State to provide visas for the
summer workforce program. And typically, there is about 100,000
international students that come into the United States to
participate in learning more about America, our economy and our
culture, while working during the summertime. And
unfortunately, this year that number is only about 5 percent of
that, or about 5,000.
So, there are a lot of things contributing to that. It is
not necessarily a new issue. It is not necessarily an issue
with COVID and with the pandemic. But it is--it is really a
seat change in America and the population and what types of
futures people are looking for. I think our industry, the
tourism and travel industry, needs to do a better job of
demonstrating and telling our story and why, particularly
entry-level jobs in tourism and travel are so important. And in
fact, statistics from U.S. Travel Association demonstrate that
people whose first job is in tourism will, by age 50, end up
earning more per year than those who started their careers in
healthcare or manufacturing or other industries in Florida. So,
it is a great entry-level opportunity. And, I think, the best
opportunity we have is to get more young people excited and
interested in the futures in the hospitality industry.
Senator Scott. Thank you, Mr. Lupfer. Mr. Daly, can you
talk about how many jobs you estimate rely on the cruising
industry, directly and indirectly, in the United States and in
Florida, and what your estimated timeline is for all those jobs
to return? And do you believe they will return?
Mr. Daly. So, thank you for the question, great question.
So, yes, I do think, as we are seeing--we have signs coming up,
right now, of the rebuild and recovery, of course, I mentioned
with the recent announcements toward Alaska. About 300,000 jobs
were impacted in 2020 from the industry, due to the pandemic.
I do believe, based on what we are seeing--you know,
obviously, the goal is a return to normal and what that looks
like. I can say that, in 2022, then--and in the future, the
demand for cruising and the response to it from consumers for
that--and from the local advisors in their communities, it has
been--it has never been greater.
So, it is going to be a thunderous return, and ultimately,
with that will come back the jobs and of course--and it impacts
more than just the jobs within the cruise industry, per se. But
it is the ancillary industries, as well, that affect
hospitality and all the local areas and cities where cruises
sail from, around the United States and as well, into other
markets, too.
Senator Scott. Thanks, Mr. Daly. Do you believe that the--
both customers, passengers, and workers can come back to the
cruise industry and operate safely?
Mr. Daly. Without a doubt. I mean, with the safety and--
safety and--safety--first, health and safety protocols have
never been more important to the cruise industry. They always
have been. And I think the enhancements that they have had over
the past 16 months, understanding the science, what we have
been seeing in our own backyards, I mean, now--people used to
show pictures of, when someone is traveling, of eating a meal.
Now they are showing pictures of someone cleaning a seat at an
airport or in a hotel.
And ultimately, I think, what we have seen and what we will
see, is the safety protocols, the healthy sail panels of the
cruise lines, partnered with the Cruise Line International
Association, to ensure they were working with the experts.
Working with science, finding the right solutions so they can
safely return to service with social distancing protocols and,
of course, with the recent vaccinations and the rollout of the
vaccinations, successfully around the United States. That is
going to be a significant factor in the safe return to
cruising.
Senator Scott. Thank you, Mr. Daly. Thank you, Chair Rosen.
Senator Rosen. Well, thank you, Mr. Daly. Senator Klobuchar
is here. We are going to give her a moment to get into her
seat, and then, she will ask the next question. We have--she
has been kind enough to join us here in person, even though so
much of our hearings have been remote because of COVID. So, we
are happy to see her here. Senator Klobuchar.
STATEMENT OF HON. AMY KLOBUCHAR,
U.S. SENATOR FROM MINNESOTA
Senator Klobuchar. Well, thank you very much, Chairwoman,
and for your great work in Nevada and across the country, when
it comes to tourism, as well as thank you so much, Senator
Scott. I know that last week you had a hearing on international
tourism and really, really important topics.
Senator Blunt and I lead the Brand USA reauthorization and
I guess I would start with that, with you, Mr. Lupfer. In your
testimony, you emphasized the importance of that, when it comes
to international travel. And one recent report found that, if
international travel does not begin to reopen soon, the U.S. is
projected to lose $175 billion in spending by the end of 2021.
Can you talk about the importance of the role of Brand USA
in the past and what we need to do going forward?
Mr. Lupfer. Thank you, Senator Klobuchar. Yes, you know, if
you think about tourism marketing, there are, kind of, three
buckets. There is your local level, which is the county, your
State level, and the national level. And for a long time, the
United States was without a travel and tourism marketing
office. And at this point, our attraction members, even the
smallest members, are able to participate in international
marketing because the leveraging that is permitted by working
with your county, who is then working with your State office,
then working with your--with our national office at Brand USA,
to take those dollars, collectively, and to spread the good
news of the destinations that America has to offer.
The United States is an incredible country. And our history
and our culture and our natural resources are not like anything
else in the world, even though we are a relatively small
country. And I am amazed at the international travelers we have
at Florida, and what interests them and what excites them, are
things that locals, kind of, take for granted. You know, show
them an alligator and their day is made. Show me an alligator
and it is roadkill.
So, what attracts internationals is so different. And what
Chris Thompson and his team at Brand USA are able to offer is
an incredible opportunity for all members of the United States
tourism and travel community to participate in sharing the
story of America with people around the world.
Senator Klobuchar. Thank you. Well, thank you, yes. We may
not have alligators in Minnesota. We do have walleye.
With that, I am going to turn it over to my good friend,
Mr. Taylor--or as I know him, D. How are you, Mr. Taylor?
Mr. Taylor. Senator, thank you.
Senator Klobuchar. OK, good. I wanted to ask you about
business travel because the hotel industry is expected to be
down 500,000 jobs by the end of 2021, partly due to predicted
permanent changes in business travel. So, even as we get out of
this pandemic, there is going to be this even longer transition
when it comes to business travel. Could you talk about that
problem? And I think one report found that half of U.S. hotel
rooms are projected to remain empty in 2021. That is about
180,000 jobs. What more should we do, when it comes to business
travel and resolving this problem?
Mr. Taylor. I appreciate the question. I think a few
things. One, I think tax incentives for conventions and/or
business travels should be temporarily looked at because in the
kind of big hotels in the cities, that--they rely heavily on
business travel. And without that, I think that the--those job
protections are rosy, compared to bleak.
Second is, we are worried about a jobless recovery, in
certain cases with the hotel industry, because they have made
it very clear, on the earnings calls, etc., about not doing
certain things that we have always assumed staying in a hotel,
like, having your room cleaned by a housekeeper, being part of
the thing that is enjoyable and actually, charging for that.
So, that is an issue.
And a final thing is this, I think, without any question,
if you look at almost every major metropolitan area, the first,
second, third largest industry is the tourism industry. I think
we have to figure out how we view those job as just as
important as manufacturing jobs. Just as important as retail
jobs. No one, very often, talks about hospitality jobs or
tourism jobs. It is easy to do that in Florida or Nevada. But
even in, say, Minneapolis, St. Paul, tourism is a huge part of
that downtown area, why people come to, etc.
So, I think we have to change our dialogue on that, and we
have to do promotions like that, and incentives like that, like
we do in other industries.
Senator Klobuchar. Very good. Mr. Newsome, you want to add
anything to that?
Mr. Newsome. Thank you--thank you, Senator. You know, I
think that D. is right on point when it comes to how we view
things. And one of the things that I think is real important,
is the unprecedented partnerships that we have created through
these tough times. I think that, you know, they say, you know,
adversity creates strange bedfellows. But I think, in this
case, strange bedfellows means that all of the organizations
come together and work together to help with tourism and help
with--and thinking through things in a whole different way.
I think that is the beauty of entrepreneurship. That is the
beauty of small business, is that we think outside of a box.
And in some cases, we do not have a box because we are focused
on trying to solve a problem. So, I think that D. is right on
point with his comments.
Senator Klobuchar. Very good. Thank you very much,
appreciate it.
Senator Rosen. Thank you, Senator Klobuchar. Now joining us
via WebEx, Senator Blackburn.
STATEMENT OF HON. MARSHA BLACKBURN,
U.S. SENATOR FROM TENNESSEE
Senator Blackburn. Thank you so much, Madam Chairman, and
thank you for continuing to work on this.
When you talk about tourism, of course, Memphis, Nashville,
East Tennessee with the Great Smoky Mountains, which is the
most visited park in our Federal Park system, we have been
really hit by this. And as I talk to leaders in the industry,
whether it is the tour industry, whether it is the motor coach
industry, whether it is, at some of the small businesses in
Gatlinburg or the support crew for concerts, and what I am
hearing is labor shortage. And what I am hearing is the
increase in Federal unemployment benefits is having a
significant adverse impact on our labor pool. And it is why our
Governor, in Tennessee, is ending the end of next month--ending
the plus up in unemployment.
So, Mr. Lupfer--am I saying your name right, first?
Mr. Lupfer. Yes, ma'am, you are.
Senator Blackburn. OK. Talk to me a little bit--I know
Miami, Orlando, they are very similar in that, tourists make up
for the way Nashville and the Smoky Mountains area is. Talk to
me about how, as the live event industry tries to recover, how
are these cities, that are event centric, like Orlando, like
Nashville, going to be able to handle these labor pressures?
And I appreciate that you mentioned the summer worker program
that Department of State has had. That has impacted us, also.
So, give me just a minute on that issue.
Mr. Lupfer. Yes, sure, thank you very much for the
question. Yes, the--the event industry, meetings and
conventions, is--probably one of the two weak links for our
recovery in Florida is the meetings and convention business and
the second would be international travel. And the fact that
Florida was only down 14 percent in the first quarter over last
year, indicates that we have really had a strong domestic
recovery already.
But the labor shortage is a real problem. The Federal
program in Florida has also been eliminated at the end of next
month. That will help. But the labor shortage is something that
predates the pandemic and there is--I think one of the messages
is, there are great career opportunities, and we need to do a
better job working with colleges and universities, and high
schools, in careers--career tracks in the hospitality and
tourism industry. It is a great industry. It is an
entrepreneurial industry. It is an industry where you gain
great responsibility, and it is--it is an area where we need to
do a better job bringing more people in to want to be a part of
our industry.
Senator Blackburn. Well, in last week's hearing, I
mentioned that CDC, DHS, DOT need to come together on guidance
to open up international travel. I know Mr. Daly would like to
see that happen. And I appreciated, in your comments, you said
that guidance from CDC, DOT, and OSHA would be--can be viewed
as conflicting. I--talk a little bit about why it is imperative
that these Federal agencies get on the same--same page, so we
can get this travel opened up. You know, we have CMA week, that
usually takes place that first week of June, there in
Nashville. And it is a big international destination.
Mr. Lupfer. Thank you, Senator. Yes, the specific conflicts
I was speaking to were protocols dealing with the virus. And
the CDC comes out periodically and updates this chart and it is
really what the news media uses to communicate where we are and
what is safe and what is not safe, and levels of safety. And
the inconsistency between the messaging from the CDC and what
the Department of Transportation says and, finally, how OSHA,
apparently, is chasing what the CDC is doing, trying to keep up
but unable to--and on their website, basically, they just punt
and say, do not look here, look there. But these Federal
agencies, they need to be in one accord. And if we are going to
communicate how to stay safe, let us all be on the same page.
Senator Blackburn. I could not agree more. Mr. Newsome,
appreciated your testimony about small businesses that contract
to the hotels because, in Nashville, we have a lot of people
that provide swag for concerts. And some of them will tell you
the concert business is 50, 60 percent of their business for
the year. So, when that shut down, they lost most of their
revenues. Is that what you are seeing in Nevada?
Mr. Newsome. Yes, absolutely. Thank you, Senator, for that
question. You know, one of the things that happens is we forget
about the hairstylists. We forget about the people who are the
wardrobe specialists. We forget about some of the small
businesses that provide microphones, and different things like
that. Everybody is impacted, from top to bottom, when the
industry shuts down. And when entertainment goes away--and I am
happy to say that this week we were talking about entertainment
coming--live entertainment coming back to Las Vegas, because
now that just creates so many opportunities and so many jobs.
So, yes, it absolutely did impact a lot of jobs and a lot of
small businesses.
Senator Blackburn. Yes, I think that those guys that are
the grips and the gaffers and the stylists and they are hauling
that equipment, they are that entire ecosystem of the live
event industry. They do the tee shirts, they do the hats, and
they man the booths. And I am with you. Let us get this money
back to those small businesses and let us help them get back on
their feet. We appreciate it.
Thank you, Madam Chairman.
Senator Rosen. Well, thank you, Senator Blackburn. And I
would like to open it to another round of questioning for us,
from Senator Scott.
Senator Scott. Thank you, Chair Rosen. So, Mr. Taylor, can
you talk about how you--for the individuals that have been able
to go back, how have you been able to help your employers
create a safe environment--work environment? And I am sure it
is different--they are all different, but I am sure it had been
difficult. How have you been able to do that?
Mr. Taylor. Yes--wait a minute, I am muted. OK. Thank you,
Senator Scott. The nuance of health and safety, I did not meet
a company in our industry that did not have huge protocol on
health and safety about people going back to work. Obviously,
as everybody knows, when the rubber meets the road, it is a
little bit different, and I think it varied. I think certain
companies took it quite seriously.
And because, as I said, and I am sure you understand, the
quickest way to get people back into our industry--to come back
is to feel safe. And what we found--for example, I know the
work I did in Las Vegas around this issue is, we had to explain
to everybody, you cannot just be safe in one casino or one
hotel. The virus (inaudible). You cannot just look at the
(inaudible). You have to also look at the customers. That--
obviously, the same message went throughout.
I think the best way to get people back, at every level, is
for the companies to do the kind of stuff on health and safety.
And candidly, I think one of the ways to do that is, either
incentivize folks to get vaccinated and those do not--if those
workers do not want to get vaccinated, they have very, very
regular COVID testing. Because anybody wants to feel safe. And
I think that is just a fundamental thing.
I think--as I said earlier, I think Disney was exemplary,
in your State, for example. I think there have been some
exemplary companies about this. And unfortunately, there have
been some who are not. And unfortunately, those who are not, I
think, jeopardize everybody else.
So, I think, more and more, that we can have a level
playing field of health and safety, the better off we will be
because, at the end of the day, the hospitality industry relies
on two things. One, people to have income in order to go
places. But also, to have the security and feeling of safety.
And then, you know, finally is, not view the workers as a
(inaudible) item but view them as a service product that brings
back loyalty, etc., which I know everybody speaking on this
call understands very well. Sometimes we have companies that
understand that very well, and some do not at all.
So, I appreciate the question, Senator Scott.
Senator Scott. Thanks, Mr. Taylor, and thanks for what you
do. Mr. Lupfer, do you believe, over the next 12 months, in
your industry that you work with is all going to come back, and
we will have the all the jobs back, that we lost during the
pandemic?
Mr. Lupfer. I wish we could get all the workers back,
actually. That is, kind of, our problem right now. But here is
a little bit of good news, at least for the folks here in
Florida. Our Spring Break/Easter season was extraordinary,
exceeded expectations. We really, kind of, got caught, not
anticipating what was going to happen.
And speaking of small business, we had three privately
owned Mom and Pop attractions that experienced 1-day all time
attendance records in April of this year. And what we are
seeing now, for the summer, is a tremendous demand on Florida,
coast to coast to coast, with pre-bookings. This is going to be
an exceptional summer season. Really the only thing holding us
back is going to be labor.
But I think, a year from now, if COVID continues the
decline and if there is not any additional big outbreaks, and
as the world comes back out of this, Florida and the United
States is going to be in a great place a year from now.
Senator Scott. Thank you. Thank you, Chair Rosen.
Senator Rosen. Thank you, Senator Scott. I have a couple
more questions I would like to ask. And so, there has been a
lot of discussion today about our economy being in full
recovery. So, I want to talk about some of the hardest hit
states during this economic crisis and where we stand today.
I am really pleased to hear that Florida is coming back and
that some of those businesses have had record attendance. And I
am sure that will continue, and I hope for that. But overall,
this recovery has been uneven.
The Bureau of Labor Statistics released state by state
April unemployment numbers just this past Friday. So, according
to BLS, 21 states still have an unemployment rate of 6 percent
or higher. And six states, including Nevada, are still at 8
percent or higher. Hawaii, which is like Nevada, depends on
travel and tourism for its economy, is actually the highest at
8.5 percent. At the other end of the spectrum, we have a dozen
states with unemployment rates under 4 percent. That is where
Nevada was, under three percent, when the COVID crisis hit. But
of course, we are not back there yet.
So, given how the recovery does look different in different
parts of the country, it makes sense that it looks different to
various Senators, depending on where their states are--various
Governors, as well. So, for my state, which relies heavily on
tourism and our small businesses that support it, we still do
need that help.
And last week in the Subcommittee, we talked about how each
of our states has so much that is unique and is beautiful to
offer to tourists and visitors. And likewise, each of our
states is unique in its public health and economic impact of
COVID-19.
So, it is important to remember, while we are all impacted
by the pandemic, pandemic-related benefits, that may not be
needed in some parts of the country, may still be needed in
others, as we begin to all recover together. Because we have to
get everybody on the other side of this crisis.
So, Mr. Taylor, with that in mind, I want to ask you a
couple questions, based on your experience and, of course, all
of your conversations. Number one, how excited are your members
to get back to work? And number two, what has the Federal
unemployment meant to those hospitality workers when we are
still only, as I think you stated, 50 percent back in Las Vegas
and so, not robustly back yet?
Mr. Taylor. Yes, I am--I am somewhat at a loss when I hear
people do not want to go back to work. I know, when I talk to
our folks, there is nothing more they want to do but to go back
to work. They do not view this as a temporary job. This is
their profession, and they have a lot of pride in that. I
think, candidly, the standard raised in Las Vegas has allowed
that, where people can actually buy a home and have, what we
call, the American Dream. So, I think that is important.
You know, as--the Federal unemployment has been a
lifesaver. And it has been a lifesaver because no one gets rich
on unemployment. The extension of unemployment and increase, I
think, even--I think the Reserve Bank of Philadelphia said has
been a huge prevention of, frankly, homelessness, even though,
as we know, in many major cities, that is a problem. It had
helped tremendously on that.
And bluntly, what you all did on--in the CARES Act and the
American Rescue Plan, on food insecurity--I never thought, in
this country, I would see the kind of food banks that I have
seen. But I know in Nevada, as you know, Senator, the Culinary
Training Academy has been having a food bank 4 days a week.
Since March of last year, they have distributed over 14 tons of
food and, frankly, that keeps on going.
We have--when I hear unemployment at 8 percent, I have no
idea where they get that number because, as you know, in the
hospitality industry, whether it be restaurants, hotels,
casinos, concert venues, etc., those are not back, even in the
most optimistic sense. And those people are without jobs.
So, the unemployment, and also the money for food, and
frankly, the eviction moratorium has been key. So, I cannot
thank you enough. But nobody wants any of that stuff. They want
to go back to work. People have pride. They want to work with
their hands. They want to meet their customers. They want to
see the loyal people come back.
So, that is the frustrating thing. At the same time, you
could open up every place in the world. If people do not feel
safe, they are not going to come back.
And I agree on the international travel. We have got to try
to get international travel moving again. I know, Mr. Lupfer is
exactly right. America is an unbelievable country. You can see
the greatest things in the world here and we want them to come
here. But obviously, part of that has to do with safety and I
appreciate all the work that you all have done on all of that,
too.
Senator Rosen. Thank you. I want to just ask one final
question and it is really to--it is to Mr. Newsome. You know,
our pandemic has really had an impact on our worker of color,
our small business owners. It has disproportionately impacted
certain racial and ethnic groups, whose employment is
concentrated in hospitality and leisure.
During the Great Recession that began in 2008--2008, excuse
me, Latinos experienced some of the highest levels of
unemployment because they were heavily concentrated in
hospitality and construction jobs, two sectors that experienced
steep downturns. As of 2018, the year for when the most recent
data is available, 32 percent of Latinos, about 34 percent of
Asians, which were employed in leisure and hospitality, they
suggest that workers in these two groups are at higher risk for
unemployment during economic downturns because of what happens
in these sectors. Immigrant workers, what we have talked about,
they have traditionally been mainstays for many of these
occupations, have also been disproportionately impacted.
So, as you are Chair of the Urban Chamber, Mr. Newsome, how
are minority owned businesses working to ensure that workers of
color, in the hospitality and tourism industry, are not left
behind? And just--you talked about it a little bit, specific
things that we may do, in some of those communities, to be sure
that we keep our small businesses growing every which way we
can?
Mr. Newsome. Well, thank you very much for that, Senator
Rosen. And as you know, you know, in 2008, I was grossly
impacted by losing 60 percent of my business, which--you know,
we spend a lot of time working with construction firms and
working with--in the hospitality industry. And one of the
things that is real important, is that, you know, we have to
keep investing. Keep investing in the work force. Keep
investing in tourism.
But like I said, really investing in the JOBS Act because
building the infrastructure is really what helped Nevada make a
turn for the better, when it came to small and minority firms
and when it came to rebuilding our economy. Because, as you
know, we--we passed the Fuel Tax, we--we built the stadium, we
built the new Convention Center. Those things brought back
jobs.
But not only that, our Nevada State legislature, in their
wisdom, put in the law that 15 percent of those contracts would
go to small businesses. That was huge because, with a focus on
that, it really brought back a lot of the work force. It
brought people back, you know, back from where they wanted to
work.
And I agree with D. that people do not want to sit at home.
People are not trying to figure out how they can just lay back
and relax on the small amount of support that they receive.
They really want to be out there working. They want to work
hard.
And as you know, Senator Rosen, the Urban Chamber, Latin
Chamber, and Asian Chamber, in support with our Vegas Chamber
and the Henderson Chamber, these--these guys all work together.
I will tell you what I love about being a Nevadan is the fact
that everybody comes close. Like I said, we are a very, very
close community, north and south. Most people try to divide us,
but as a Nevada community, we are all in the same boat and we
typically come together to make sure that, if the least of us
suffers, we make sure that we all chip in.
So, our minority communities can rebound with the support
of these investments and some of the innovation that we are
talking about. Plus, it also helps to build our infrastructure.
It also helps us to build our community. And then, everybody--
everybody working is really what the goal is and getting
everybody back to recover together. And I call it more than
recovery. I call it rebounding because I think rebounding means
you are bouncing back. Recovery is you are going back to where
you were. I think we need to go better and harder and stronger
than where we were before.
Senator Rosen. I like that. We are going to rebound.
Senator Scott, do you have anything else? Otherwise, I am going
to close out the hearing.
[Silence.]
Senator Rosen. So, I really want to thank all of our
witnesses for being here today, for your work, for your
passion, for your care, for your states, for your communities,
and everything that you do. It is so important, and we will all
rebound together. So, I really appreciate you all.
So, for the record, this hearing record will remain open
for two weeks, until Tuesday, June 8, 2021. Any senators that
would like to submit questions for the record, should do so by
Tuesday, June 8, 2021. For those of you who testified today, we
ask that your responses be returned to the Committee as quickly
as possible, and in no case, later than two weeks after
receipt.
That concludes today's hearing. I thank you.
[Whereupon, at 4:24 p.m., the committee was adjourned.]
[all]