21 years ago, Mammoth Mountain went through what was called Black Monday – the layoff of 150 employees after a series of droughts. This year, the layoff number was half that but the agony just as bad. Mammoth Mountain CEO Rusty Gregory said that the regional drought and low skier demand led to “draconian and severe reactions.”
The CEO explained that every few years the Eastern Sierra suffers drought. Contingency plans for drought, he said, get more severe the more severe the drought is. This year, he said, it was a national phenomenon and the perception of virtually no winter hurt the ski industry across the nation. As of Wednesday, he said. skier visits were down 33% and revenues by 29%.
Wednesday’s layoff included 75 year-round employees with an average longevity of 10 years. Two vice presidents were in the group of lost jobs. One had worked at the Mountain for over 40 years. Gregory said the Mountain faced a drop off of $40 to $45 million in revenues – not enough, he said, to stay in business. The CEO said, “We re-did our priorities which were to keep the doors open and maintain a great guest experience.” Those whose jobs were not directly related to the on mountain experience were listed for layoff.
Gregory said, “These were 75 year-round employees that we normally need. We don’t have the money to pay them.” He added that everyone who was laid off was in good standing. He said he hopes he can re-hire them, but not until the Mountain is financially able. Among those who lost jobs were workers in accounting, supervisory positions, maintenance, mechanics, equipment operators, information technicians. Some were in management, others were not. Gregory repeated that you “can’t take $40 to $45 million out of an annual $150 million budget and wait to go broke.”
Earlier in the winter, Gregory had cut expenses and finally cut hours and pay. He said President’s Holiday looked good, but it wasn’t enough. Gregory met with top management in several day long meetings. He said they looked at what jobs to eliminate or consolidate. Labor takes up 50% of the annual $150 million in revenue, according to Gregory. Officials decided to reduce the cost of employees in the amount of the revenue reduction.
Gregory did agree to some severance and to health insurance for employees and their families for a period of time related to years of service. Year round, Mammoth Mountain employed 359 people. The layoff of 75 amounts to 20.8% of the workforce there, according to Gregory.
How will the Mountain deal with maintenance and the “fix-it” time of year during spring and summer? Gregory said, “We’ll get to it when we get to it.” He repeated that the priority is to keep the Mountain open as a good experience for guests.
After Rusty and his executives put together a plan, top management, mostly, delivered the bad news to workers on Wednesday. As of Thursday, the layoffs were still underway. Going forward, Gregory said, “I hope to re-hire. In the past, a significant number have been brought back at the same pay and level of benefits, but,” he said, “it certainly will not be until winter.”