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How Has U.S. Leisure and Hospitality Employment Recovered Since September 11?
25 Aug 06
A comparison between the state of the leisure and hospitality employment sector in the second quarter of 2006, and the quarters just before (2001Q2), and after (2001Q4) the attacks occurred.
The leisure and hospitality services (LHS) employment sector includes jobs related to arts, recreation, entertainment, accommodations, and eating and drinking establishments. In the aftermath of the attacks in September 2001, this sector posted declines in many metropolitan areas as people began to travel less and stay at home to eat meals and watch television. Among those metro areas with the largest numbers of LHS jobs (see table below), several—such as New York, Las Vegas, and Orlando—saw large drops in employment between the second quarter of 2001 and the fourth quarter of 2001. Other metro areas, mainly concentrated in the western portion of the United States (Los Angeles, Houston, and Phoenix),, saw no declines in employment after the attacks. However, of those areas that posted declines, all had returned to pre-downturn levels in less than three years time. Five years later, in the second quarter of 2006, all of these metro areas have LHS employment levels that are well above where they were when the attacks occurred. Top 11 Metro Areas, Ranked by Leisure and Hospitality Employment (Thousands) | | | | | | | | | | | | Share of Total Employment | | 2001q2 | Rank | 2001q4 | Difference 2001q2 to 2001q4 | Return to 2001q2 Level | 2006q2 | Rank | Difference 2001q2 to 2006q2 | 2001q2 | 2006q2 | New York, NY-NJ (Div) | 355.66 | 1 | 343.54 | -12.12 | 2002q2 | 383.19 | 2 | 27.53 | 6.8 | 7.5 | Los Angeles, CA (Div)' | 348.19 | 2 | 350.05 | 1.86 | | 385.08 | 1 | 36.89 | 8.5 | 9.5 | Chicago, IL (Div) | 307.41 | 3 | 302.03 | -5.38 | 2002q4 | 331.52 | 3 | 24.11 | 7.9 | 8.7 | Las Vegas, NV | 237.62 | 4 | 229.02 | -8.60 | 2003q3 | 269.98 | 4 | 32.36 | 32.6 | 29.5 | Atlanta, GA | 200.31 | 5 | 199.06 | -1.25 | 2002q4 | 224.93 | 5 | 24.62 | 8.7 | 9.4 | Houston, TX | 187.62 | 6 | 188.32 | 0.70 | | 209.71 | 6 | 22.10 | 8.2 | 8.7 | Washington, DC-VA-MD-WV (Div) | 175.31 | 7 | 174.44 | -0.87 | 2002q1 | 206.39 | 7 | 31.08 | 8.1 | 8.6 | Orlando, FL | 173.31 | 8 | 162.40 | -10.90 | 2004q1 | 189.58 | 8 | 16.27 | 18.8 | 17.6 | Dallas, TX (Div) | 170.87 | 9 | 167.32 | -3.55 | 2004q1 | 181.29 | 9 | 10.42 | 8.6 | 9 | Santa Ana, CA (Div) | 154.79 | 10 | 155.67 | 0.89 | | 165.56 | 11 | 10.78 | 10.9 | 11 | Phoenix, AZ | 152.17 | 11 | 152.22 | 0.05 | | 177.54 | 10 | 25.37 | 9.5 | 9.5 |
It also helps to look at those metro areas that posted the largest declines after the attacks. This grouping consists of areas that are mainly known as tourist destinations, and also includes some of the areas mentioned in the previous paragraph. New York posted the largest decline, which would be a direct result of the attacks that happened in that metro area. The rest are mainly areas that rely heavily on air traffic, and as flights were basically on hold, these areas suffered as well. Among this group of metro areas (see table below), the return to pre-downturn employment levels in the LHS sector was nearly as quick, with most returning in under three years time. San Francisco returned to its second-quarter 2001 level in the first quarter of 2006, while two areas have yet to reach that point (Atlantic City and San Jose), although they are close. Top 11 Metro Areas, Ranked by Decline in Leisure and Hospitality Employment in 2001Q4 | | | | | | | | | | | Share of Total Employment | | 2001q2 | | 2001q4 | Difference 2001q2 to 2001q4 | Return to 2001q2 Level | 2006q2 | | Difference 2001q2 to 2006q2 | 2001q2 | 2006q2 | New York, NY-NJ (Div) | 355.66 | | 343.54 | -12.12 | 2002q4 | 383.19 | | 27.53 | 6.8 | 7.5 | Orlando, FL | 173.31 | | 162.40 | -10.90 | 2004q1 | 189.58 | | 16.27 | 18.8 | 17.6 | Las Vegas, NV | 237.62 | | 229.02 | -8.60 | 2003q3 | 269.98 | | 32.36 | 32.6 | 29.5 | Chicago, IL (Div) | 307.41 | | 302.03 | -5.38 | 2002q4 | 331.52 | | 24.11 | 7.9 | 8.7 | San Francisco, CA (Div) | 117.11 | | 112.01 | -5.10 | 2006q1 | 117.91 | | 0.80 | 11 | 12.4 | Miami, FL (Div) | 95.56 | | 91.71 | -3.85 | 2004q1 | 101.69 | | 6.13 | 9.3 | 9.7 | Dallas, TX (Div) | 170.87 | | 167.32 | -3.55 | 2004q1 | 181.29 | | 10.42 | 8.6 | 9 | San Jose, CA | 74.25 | | 70.95 | -3.30 | | 73.71 | | -0.55 | 7.2 | 8.5 | Seattle, WA (Div) | 120.22 | | 117.00 | -3.21 | 2003q4 | 131.75 | | 11.54 | 8.6 | 9.3 | Honolulu, HI | 58.96 | | 56.34 | -2.62 | 2003q4 | 62.98 | | 4.02 | 14.3 | 13.9 | Atlantic City, NJ | 60.27 | | 57.82 | -2.45 | | 59.70 | | -0.57 | 40.6 | 38.5 |
One interesting note is that those areas with concentrations of LHS employment that are substantially higher than the U.S. level (9.1% in 2001q2 and 9.6% in 2006q2) have seen their shares decline over the past five years (Las Vegas, Honolulu, Orlando, and Atlantic City). Although employment levels are at or above where they were five years ago, it appears as if the economy is diversifying to become slightly more stable in the event something like September 2001 happens again. The remaining areas, which have shares much closer to the U.S. level, have followed the national trend of seeing shares increase. All in all, leisure and hospitality employment is still very strong in the nation and seems to have suffered no long-lasting effects from the events of September 2001. By Jeannine Cataldi
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