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West Coast Tourism Facing Huge Losses After Terror Attacks - 2001-10-02

The U.S. tourism industry is facing losses following last month's terrorist attacks in New York and Washington. The impact is being felt at major tourist venues on the West Coast.

Hawaii governor Benjamin Cayetano says the downturn in tourism may cause the worst economic crisis in his state's history. Mr. Cayetano has asked his state legislature to borrow $1 billion to stimulate Hawaii's economy. Part of the money would be spent on a marketing campaign to entice visitors back the state.

Officials in Las Vegas say the city is losing $30 million a day in tourism revenue. Nearly 200 business meetings and conventions have been canceled, and unemployment claims are 50 percent higher than usual.

One hundred thousand hotel workers have lost their jobs in Los Angeles, and those who are still working have had their hours reduced. Carol Martinez of the Los Angeles Convention and Visitor's Bureau says tourism is a major part of the local economy.

"Direct visitor spending is $13.6 billion a year. We know, on average, that travel spending in Los Angeles is $37 million a day," she said.

Ms. Martinez says in a typical September, 70 percent of Los Angeles hotel rooms are occupied. This September, hotels were less than half full, resulting in daily losses of tens of millions of dollars. That includes $2.5 million that had been expected from a single sales meeting for Toyota motor company.

Airlines around the United States have slashed their flight schedules and still most aircraft are flying with half of their seats empty. In Los Angeles, more than 10,000 airport workers are expected to lose their jobs, as are tens of thousands of others in related businesses, such as airport food concessions.

Monday, California Governor Gray Davis signed a bill to increase unemployment benefits by $100 per week, effective in January, to help those who have lost their jobs in the downturn.

Mr. Davis says the first duty of state officials is to keep the airports safe, following the terror attacks using hijacked airplanes.

"Our second mission is to do everything we can to help those workers who were laid off in the wake of the unspeakable act of terrorism that was committed on September 11," the governor said. " As you know, many people have lost their jobs working for the airlines. There have been other people working for rental companies, shuttle companies, concessionaires, people that serve the airport industry that have lost their job as well."

Travel agents are trimming their staffs in an effort to stay in business. But Randy Asatorians, an Armenian immigrant who runs an airport taxi service, says some of his customers are starting to fly again.

"Well, if they have to go, they have to go. Right now, the flights are safer than before because of the security," he said.

The airline industry reports that air traffic picked up slightly over the weekend. And Mr. Asatorians says heightened airport security has ironically helped his business. His limousines are licensed to enter the terminal area of the Los Angeles airport, where officials have barred private vehicles.

But the crisis in the travel business is far from over, says Carol Martinez of the Los Angeles Convention and Visitor's Bureau. She says that after the Gulf War in 1991, foreign tourists did not return to the city for another six months. And that war had a clear end, unlike the current war on terrorism.