LAS VEGAS — Teri Zunick rapped on the window of a downtown pawnshop. She was wilting in 113-degree heat, and clutching the gold bracelet she needed to hock so her electricity would stay on.
Zunick, 45, is also struggling to pay her mortgage and fill up her $60-a-tank SUV. She has stopped getting her pool professionally cleaned. She plans to cancel her cable subscription.
But desperate to pay her electric bill -- now -- Zunick had few options besides Gold & Silver Pawn, a 24-hour shop on a gritty sliver of Las Vegas Boulevard.
Business there is terrific.
When the economy is troubled and the rent takes precedence over heirlooms, the pawnbroker is king. Skyrocketing gas and grocery bills and a rash of foreclosures have been windfalls for the industry's nearly 13,000 shops. So has the surging price of gold, at more than $900 an ounce; people are cashing in their pins, watches, earrings, necklaces and wedding bands.
Earnings of the three publicly traded pawn companies -- Cash America International Inc., EZCORP Inc. and First Cash Financial Services Inc. -- grew by double-digit percentages this year.
Last week, at the National Pawnbrokers Assn. convention here, shop owners said they were lending more money to more customers for longer periods. Even the well-to-do are bringing in motorcycles, laptops and power tools for cash, pawnbrokers said.
"If it weren't for me, by the 15th of the month the whole town would go dark -- they couldn't pay their utility bills," said Larry Hipps, who owns Larry's Jewelry & Pawn in Florence, Ala.
Pawnshops specialize in small loans -- the average is $75 -- and hold everything from televisions to saddles as collateral. More than two-thirds of customers redeem their goods by paying back their loans plus interest, said the pawnbrokers association. The shops sell the remaining items.
Pawnbrokers' experiences are a window on how the economic downturn has wounded the working class.
"The sector we deal with is living paycheck to paycheck," said Frank Ellis, a vice president for Capitol City Pawn & Jewelry, which has nine stores in Nebraska and Kansas.
Many customers are extending their loans by 30 to 45 days -- presumably because it's tougher to scrape together money. "They don't want to lose what they have," Ellis said.
Typically, spring and summer are sluggish for Joe Maciaszek's American Cash Pawn in Monroe, La. The store usually extends eight to 10 pawn loans a day, but the rate has tripled in recent months. His employees are forced to quiz customers more thoroughly.
