Park City ski resorts opt for $15 minimum wage amid ‘severe’ labor shortage
Summit County’s cost of living further depresses wages, official says
The nationwide labor crunch is being felt in the Park City area, too, officials said, with some restaurants skipping lunch service and cutting hours, and “Help Wanted” signs hanging in businesses across Summit County.
In a sign the ski industry isn’t immune to the hiring woes, Vail Resorts and Deer Valley Resort, two of Summit County’s biggest employers, announced in recent weeks they would pay non-tipped employees a minimum wage of $15 per hour.
Jennifer Wesselhoff, the president and CEO of the Park City Chamber/Bureau, welcomed the increased wages and said they come during a “severe” shortage of workers.
“Almost every single business that I talk to is telling me their No. 1 issue is the workforce shortage and finding employees,” Wesselhoff said.
She said the trouble finding workers is part of a broader pandemic-fueled economic transition, with millions of people having left the workforce nationwide and others changing positions or pursuing education or training.
“From what I understand, it’s basically a reassessment of the workforce in America,” she said. “It’s not just a resort town issue.”
The shortage, though, is certainly present locally. According to the Utah Department of Workforce services, Summit County’s seasonally adjusted unemployment rate was 2.4% in June.
Jeff Jones, the county’s economic development director, said it is too early to tell what sort of effect the resorts’ pay raise will have on the local economy and whether it will put pressure on other employers to raise their pay, as well.
“When the resorts raise their minimum wage to $15, it doesn’t mean all the places in Kamas are going to raise theirs to $15,” Jones said. He said a worker’s proximity to a job and the cost of living in an area were significant factors in evaluating wages.
The labor shortage, though, presents a fairly serious problem, Jones said.
In 2018 and 2019, the local economy gained about 6,000 seasonal jobs in the winter. Foreign workers using J1 visas comprise about 2,000 to 2,400 of those workers in a normal year, Jones said, leaving 3,000 to 4,000 jobs to fill.
He said hiring will likely continue to be a challenge.
“Some demographers out there are referring to it as the ‘sans-demic,’ (meaning) ‘without people,’” Jones said.
The effects could include more expensive food at restaurants or merchandise at stores when proprietors pass on increased labor costs to consumers. It has already led to restaurants closing during less lucrative hours.
“We’re finding out workers make the wheels go round,” Jones said.
The ski resorts operated with less than full staffs last year with many on-mountain restaurants closed or severely limited by the pandemic, but will likely need more workers this year.
Jeremy Levitt, the president of Deer Valley, said in a prepared statement announcing the wage increase that the raise would be offered for winter jobs this season.
“The Park City area continues to see a competitive job market and high cost of living,” Levitt said in the statement. “In order to retain our talented team and recruit future staff members, it is essential we increase our starting wages and continue offering industry-leading benefits.”
A Vail Resorts spokesperson in a prepared statement did not specifically address whether the wage increase was a recruitment tool.
“These wage changes will be the largest single investment we make as we head into next season,” the statement said. “We know that talent and staffing will be critical for our success this winter season, as they always are.”
Wesselhoff said she’s heard businesses have used many different tactics to entice workers. In addition to sign-on bonuses, she mentioned transportation stipends, health and wellness benefit packages and housing offsets.
But Wesselhoff said the labor shortage was putting small businesses in a tough position, forced to compete for employees with deep-pocketed resorts while having thinner profit margins.
Jones said that businesses looking to hire would devote all the resources they could to the effort.
Nationwide, Jones said that average hourly earnings for leisure and hospitality workers rose to $18.09 in June, a record.
But he indicated that wages alone show an incomplete picture.
He shared data that shows Summit County waiters earn about $2,000 more than their counterparts in Utah County, for instance.
The cost of living in Summit County, however, is about 35% higher than the national average. With that factored in, Summit County waiters’ median wage goes down to about $16,000, while Utah County’s stays around $19,500.
“The impacts of cost of living cannot be overstated,” Jones said.
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