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Disney World’s Top Rival Just Rattled the Theme Park Industry

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It was the pay hike heard ’round the Disney World. Comcast‘s (NASDAQ:CMCSA) Universal Orlando announced on Thursday that it will pay all employees a minimum of $15 an hour come June 27. The new starting salary for all full-time and part-time hourly workers as well as entry-level salaried hires is a pretty big deal in Central Florida. 

Rival Disney (NYSE:DIS) is getting there. Three summers ago Disney World reached a deal with a half-dozen unions representing the lion’s share of the resort’s employees. Disney was starting new employees at just $10 an hour at the time, but the agreement has the House of Mouse scaling higher until the new hourly minimum rate for non-tipped “cast members” goes from $14 to $15 in October. With staffing becoming a problem across many consumer-facing businesses, victory in the “fight for $15” was inevitable.

This was supposed to be the summer that national theme parks and regional amusement parks have been anticipating for two years. Can theme park operators thrive in the new normal? Should investors start separating the winners from the losers as wage inflation crashes the turnstiles? Let’s take a closer look at Comcast’s significant move.

A Nintendo executive posing in front of the Universal logo at Universal Orlando.

Image source: Universal Orlando.

Going for a ride

What if the country threw a post-pandemic reawakening party and too many people called in sick? A lot of industries are suffering through a staffing crisis right now. It’s evident in the restaurant industry. Even the leading ridesharing companies are struggling as demand for transportation and takeout deliveries is outstripping the driver supply

We’re already seeing ripples in the amusement park industry, and this is before the start of the peak summer travel season. Cedar Fair‘s (NYSE:FUN) iconic Cedar Point recently turned heads for updating its June availability. The park will be closed on Tuesday and Wednesday through the next four weeks, citing insufficient employees to operate every day. Last week it took the dramatic step of doubling its pay to $20 an hour and offering a $500 signing bonus for new or returning hires. Bumping up labor costs will weigh on the bottom line, but it’s better than not being open at all.

Universal Orlando and eventually Disney paying $15 an hour will be easier to stomach at gated attractions where single-day tickets run in the triple digits, but one has to wonder about the competition. Central Florida’s third-largest theme park operator by attendance — SeaWorld Entertainment (NYSE:SEAS) — raised its hourly rate to $11 an hour in late 2018. It won’t be able to stay there when its two largest rivals are paying 36% more. SeaWorld Orlando employees may be passionate about the marine life cause, but will that still hold up if they are literally being discounted? 

Paying more is easier said than done, especially now when a theme park’s profit potential is capped by limits on guest capacity and travel restrictions are gnawing away at Central Florida’s most lucrative customers. SeaWorld stock may be hitting new highs, but keep an eye on its operating calendar and the ongoing delays in new rides that were supposed to debut in 2020. Investors are bidding up leisure stocks ahead of what is supposed to be a blowout summer season, but don’t forget to belabor the labor point.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

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Congress demands govt reveal ‘true’ Covid death figures, wants Rs 4 lakh each for victims’ kin

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File photo of Congress leader Rahul Gandhi | PTI


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New Delhi: The Congress on Sunday said credible and true figures of COVID-19 deaths in the country should come out and it will strive to get a compensation of Rs 4 lakh each to the families of those who died of the viral disease.

As part of the party’s campaign for exerting pressure on the Centre to grant compensation to the victims of the coronavirus, Congress leader Rahul Gandhi put out a video of the families that suffered during the second wave of the pandemic.

Leader of Opposition in the Rajya Sabha Mallikarjun Kharge said the Congress would raise the issue in both houses of Parliament and seek the grant of a compensation of Rs 4 lakh to all such families from the government.

Gandhi shared a 4.31-minute video on Twitter in which families that lost their dear ones due to Covid in Gujarat alleged that they did not receive any government help at the time.

He also attacked the “Gujarat model”, which the ruling Bharatiya Janata Party (BJP) has projected as the best in the country.

“The stories of the families of those who died due to Covid are true, their pain and suffering are also true. The government statistics are false. True figures will have to be reported and a compensation of Rs 4 lakh will have to be given,” Gandhi said in a tweet in Hindi, using the hashtag “4LakhDenaHoga”.

He also said in the video that the Gujarat model is discussed a lot, “but the families whom we talked to said they neither got hospital beds, nor oxygen or ventilator”.

The Gujarat government says officially, only 10,000 people died due to Covid, but the truth is that over three lakh people have died of the viral disease in the state, the former Congress chief claimed.

“We want that the truth about Covid deaths should come out and those whose kin died due to Covid should get adequate compensation,” he said.

Gandhi said the government’s job is to help people. When the government was to offer help to them when they were in hospital, it did not do so and now, when they have spent so much on hospital treatment, it is not even coming forward to offer them compensation, he said.

“What kind of a government is this?” the Congress leader asked.

“We wanted to be with you in your time of need and wanted to assure you that we are with you and there is no need to worry,” Gandhi was heard telling one of the victims in the video.

“Lakhs of people have lost their father, mother, brothers and sisters. They will not come back. But remember that the Congress will use all its might to get them a compensation of Rs 4 lakh,” he said.

Kharge said in both houses of Parliament, the opposition party would seek that the government grants compensation to the families of those who died of Covid.

“We will raise the issue in Parliament and seek the cooperation of all. The poor should get Rs 4 lakh each as they were devastated by Covid and their earning members were lost. They lost their kin and their incomes due to the government’s negligence,” he told PTI.

“According to estimates, at least 50 lakh people have died in the country due to Covid. In Gujarat alone, while official figures say only 10,000 people died, around 3 to 3.5 lakh people have lost their lives,” Kharge said.

Pitching for a re-survey and a correction in the statistics, he said, “The families of the victims should also be compensated.”

Kharge said the government has to rehabilitate such families by paying them a compensation of Rs 4 lakh, a campaign for which has been launched by Gandhi.

The leader of opposition in the Rajya Sabha said the surveys conducted by several foreign agencies have pointed to a lower number of deaths being recorded in the country.


Also read: It’s Congress vs Congress again, Manish Tewari clarifies after Adhir criticises unreleased book


 

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