US Casino Industry Declines Further In 2009

A report released by ‘The American Gaming Association (AGA) Survey of Casino Entertainment’ has revealed that casino revenues in the US have continued to decline for the second consecutive year, largely due to the recession and changes in consumer leisure spending.
In 2007, spending at US casinos across 13 states reached a high of $34.13 billion but in 2008 that figure had fallen to $32.54 billion and by 2009 had declined a further 5.5% to $30.7 billion.
New Jersey and its gambling resort of Atlantic City, experienced the biggest drop in gaming revenue of 13.3%, falling from $4.54 billion in 2008 to $3.94 billion in 2009.
Commenting on the overall decline in the industry, AGA’s president and CEO Frank J. Fahrenkopf Jr said: “This past year was tough for all Americans, and it was tough for our business as well…I don’t ever remember a decline. There has been a strong growth period over the last 15 years.”
The waning gaming revenues has had a knock on effect on the industry as a whole, with nationwide gaming taxes falling 1.6% to $5.59 billion, gaming employment falling 8.1% to 328,377, and wages down 7.1%.
With higher unemployment and tighter budgets, consumers have cut back on their leisure spending, and David G. Schwartz, director of the Center for Gaming Research at the University of Nevada, Las Vegas, has come up with another intriguing reason why casinos resorts have suffered perhaps more than most during the economic downturn. As he explains:
“In 2006-07, when people’s 401(k)s were expanding and they bought homes that doubled in value, they thought they were a lot smarter than they were. They said, ‘I’m a good investor, let’s spin the wheel.’ Since people have seen their portfolios plummet, they’re a little more gun-shy.”
One resort bucking the trend, however, was Pennsylvania, which actually saw its revenue increase by 21.6%, although this would seem to have come largely at the expense of its neighbouring states, especially New Jersey.