Vail Resorts announces $15 minimum wage
Company reports strong pass sales as of June 4
Vail Resorts on Monday announced that as of the coming ski season, it will raise its starting wage to $15 per hour in Colorado, Utah, California and Washington. The company also announced strong gains in pass sales.
The news came during a Monday earnings call by Vail Resorts CEO Rob Katz and Michael Barkin, the company’s chief financial officer.
“Given the continued challenging operating environment as a result of COVID-19, we are very pleased with our overall results for the quarter and for the full 2020-21 North American ski season,” Katz said. “Results continued to improve as the season progressed, primarily as a result of stronger destination visitation at our Colorado and Utah resorts, including improved lift ticket purchases relative to fiscal 2021 second quarter results. Excluding Peak Resorts, total visitation at our U.S. destination mountain resorts and regional ski areas for the third quarter was only down 3% compared to the third quarter of fiscal 2019.”
Pass sales for the 2021-22 season are up from 2019 in both units sold and dollar volume. Sales from 2020 weren’t used for the comparison due to the COVID-19 pandemic.
Vail Resorts’ fiscal year begins Aug. 1, which puts the third quarter in February, March and April, with March generally the busiest month of the season.
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Pass sales for the 2021-22 ski season have been strong, Katz said, adding that “guests showing strong enthusiasm for the enhanced value proposition of our pass products, driven in part by the 20% reduction in all pass prices for the upcoming season.”
Katz added that the decrease in pass prices seems to have driven buyers into higher-level passes. That accounted for a roughly 33% increase in sales revenue despite a 10% decline in per-unit prices compared to 2019.
While pass sales are strong, Katz said Vail Resorts doesn’t plan to return to last season’s reservation system. But, he said, the reservation system did provide “a lot of insights” into more efficiently operating the company’s resorts.
But running a ski resort requires employees, and a lot of them.
Responding to an analyst’s question, Katz noted that Vail Resorts’ previous entry level wage was $12.50 per hour.
In addition to the new entry-level wage, a company memo from Katz states that employees working just above the firm’s minimum will have their wages adjusted upward.
The company this year will also return to its previous practice of providing annual merit raises of up to 3%, depending on performance.
“The cost of these wage changes will be the largest single investment we make as we head into next season,” the memo states.
In addition to wages, Vail Resorts also announced Monday that as of the coming ski season, the company will provide paid sick leave to all full-time seasonal employees not already eligible for sick time.
That means full-time seasonal employees will have the same sick time benefits as year-round employees.
$15: New hourly wage for Vail Resorts employees in Colorado, California, Utah and Washington.
80%: Increase in net income in Vail Resorts’ third quarter compared to the previous year.
50%: Increase in pass sales through June 4, compared with the similar period in 2019.
33%: Increase in pass sales volume through June 4, compared with the same period in 2019.