US Casino Industry Continues Dramatic DeclineMarch 12, 2010 10:32 am
After recording a 4.6% drop in revenue for 2008, the decline in the US casino industry has continued unabated with the 12 US authorizing casino states posting a 5.7% fall in revenue for 2009 to $30.7 billion, according to figures from the American Gaming Association.
Nevada saw its gaming win in 2009 fall to $10.4 billion, down 10.4% compared to 2008, and representing the single largest drop since records began 55 years ago. Atlantic City’s 11 casinos posted their lowest gambling revenues in over ten years while New Jersey’s casino revenues had fallen 8.5% in January from a year earlier.
In addition, since 2001 the number of adults visiting a casino over the past year has declined by 14%, and what makes the statistics more concerning is that the shift has been gradual, indicating it is not just the result of the recession.
Aside from the global financial crisis, several other factors have been identified to explain the dramatic decline in land based casinos, such as the migration of players to online casinos and poker rooms. As Mintel senior analyst Billy Hulkower explains:
“Casinos may be losing audience to the increasingly compelling entertainment offerings in the home; such as HDTV (high definition TV), high-end video game systems and the Internet, including Internet gambling,”
This all spells bad news for those states which have relied heavily on gaming tax revenues in the past, as well as those which have been hit hard by the recession and have tried to jump on the gambling band wagon to help balance their budgets.
Commenting on the situation, Senior analyst at the Rockefeller Institute Lucy Dadayan said: “The expansion of gambling does not bring more customers into the market. There are only so many customers, so with every new casino there are only marginal increases. The overall trend for the state tax collections from casinos… is still downward.”