Las Vegas Tourism Struggles Amid Economic Challenges

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The once-bustling Las Vegas Strip now faces a notable decline in tourism.

News Summary

Las Vegas is facing a significant downturn in tourism, severely affecting local businesses. Naked City Pizza reported drastic sales drops, processing only seven orders on a slow day compared to their usual 60 to 80. Tourism figures reflect a 6.5% decline, and airport traffic has dropped nearly 4%, raising concerns about the economic landscape. Despite a slight increase in convention attendance, pressures from rising inflation and consumer concerns weigh heavily on the gaming and hospitality sectors. Experts suggest future growth could come from new developments, including a professional sports franchise.

Las Vegas is experiencing a notable downturn in tourism, significantly impacting local businesses. Naked City Pizza has reported stark declines in sales, with the establishment only processing orders for seven pizzas on a slow Monday, compared to a standard of 60 to 80 during peak times. This decrease is indicative of a broader trend affecting the city’s economy, which remains heavily reliant on travel and tourism.

Owner Christopher Palmeri of Naked City Pizza has observed a drastic reduction in tourist activity, noting that foot traffic and business volume have plummeted. This sentiment aligns with the analysis from various local economic experts, who cite the 6.5% drop in tourism from May 2024 to May 2025, as reported by the Las Vegas Convention and Visitors Authority (LVCVA). The overall hotel occupancy rate has also seen a decline of 3.1%, settling at 83.0%.

In addition, airport passenger traffic at Harry Reid International Airport has decreased by nearly 4% year-over-year. Jeremy Aguero, a principal analyst at Applied Analysis, indicates this downturn was anticipated, characterizing the current state as a natural settling phase for tourism during the summer months. Despite the drop, Aguero noted a cautious optimism, explaining that when compared to 2019 figures, current tourism levels remain higher than pre-pandemic averages.

The economic environment for Las Vegas travelers is becoming increasingly strained, largely due to rising inflation and overall consumer concerns about higher prices. Many domestic travelers are reconsidering their trips to Las Vegas, either opting to reduce their travel budgets or staying home altogether. These pressures have also been reflected in the gaming industry, where casino gaming wins have declined by 2.1% statewide and by 3.9% specifically on the Las Vegas Strip.

Despite these challenges, there has been a slight increase in convention attendance, with May 2025 showing an uptick of 10.7% compared to the same month the previous year, culminating in over 511,200 visitors. However, international arrivals have faced significant declines, particularly from Canada, with airlines like Air Canada and WestJet reporting decreases exceeding 20%.

In terms of hotel accommodation, the average daily room rate for May 2025 was calculated at $198.20, reflecting a minor decrease of 2.2% from the prior year. The Las Vegas Strip reported an average room rate of $212.46, while downtown hotels averaged $109.39. With the first five months of 2025 demonstrating a 3.7% reduction in overall airport passenger numbers and a 4% drop in domestic traffic, the economic landscape for Las Vegas travelers is projected to remain challenging.

Academic insights suggest potential future growth avenues, as Amanda Belarmino, a professor at UNLV’s Harrah College of Hospitality, pointed to the anticipated positive impact of a new professional sports franchise, the A’s, which is expected to begin operations in Las Vegas in 2028. Such developments could provide a much-needed boost to the city’s economy in the long term.

The Las Vegas economy is in a period of readjustment, with tourism numbers responding to economic pressures and consumer sentiment. Local businesses, such as Naked City Pizza, are feeling the immediate effects of this downturn, while industry experts continue to analyze future prospects as the city adapts to the evolving economic landscape.