They are as ubiquitous as the Caesars commercials for sports betting, your neighbor cutting the grass when you’re trying to sleep in on a weekend, or sand in your bathing suit.
They are the gaming revenue reports. They go by many names and are broken down differently by different states. It’s complicated, but there is a reason to care.
States use the taxes (different states have different rates) gained from that revenue for various grand projects, mostly education, but also infrastructure or veterans services.
But really, whether a casino company in (your state name here) made $96.1 million in March and then made $98.2 million in May, does it really matter to the public?
“Fluctuations in revenue generated by gaming businesses in the state are monitored closely as the monthly casino revenue numbers reported by the New Jersey Division of Gaming Enforcement (DGE) are viewed as a barometer of the overall health of the New Jersey economy,” said Dr. Jane F. Bokunewicz, the faculty director of the Levenson Institute of Gaming at Stockton University in Atlantic City.
Revenue reports are business reports. We may not know how well your local grocery store chain is doing, but we know how the casino industry is doing and because the numbers are so big, you should care.
“If the casinos are thriving, the state is perceived as doing well,” Bokunewicz said.
“When casino revenue declines it creates uncertainty and concern about the overall outlook for the state.”
Revenue reports indicate strong gaming industry but potential fluctuations
Inflation is the topic in America. The biggest indicator is the rising price to fill up your car at the pump. The US casino industry – including New Jersey and Virginia – is not immune to inflation issues but was well positioned before and after the pandemic to offer an experience Americans wanted.
Anecdotally, foot traffic seems down at casinos. Still, the entire gambling industry has seen its fortunes double — and even triple — in recent years with the rise of iGaming legalization (the ability to play casino games for real money on a mobile device) and sports betting.
Online gaming widely outperforms sports betting regarding revenue, but it’s easier to explain sports betting.
The latest CDC Gaming Focus report on the industry offered the theory that American consumers have stopped stocking up in preparation for a lockdown and started to go out. April revenue across the board (every state) was $5.199 billion. It’s the second-biggest month of all time, just behind March, which was $5.3 billion.
What does this mean to you? It means that your home state is getting some serious money from the taxes on this revenue. If you’re in a town with a crumbling bridge or a dilapidated school, you have the right to question where all this money is going. It should be used for something. Many states have been using this tax money wisely, but as the economy slows, gambling revenue could be declining in the coming years.
Using New Jersey as a road map to revenue reports
Let’s talk about New Jersey, which is undoubtedly one of the top 3 gaming hotspots in the US. New Jersey is Bokunewicz’s home, and the New Jersey model can be used to understand other states’ revenue reports. The American Gaming Association estimates that New Jersey casinos have an economic impact of $6.45 billion yearly, generating $1.19 billion in taxes.
That should fix a lot of potholes. New Jersey casinos also directly employ approximately 22,000 people, which is 8.1% of the total tourism jobs in the state.
“In 2021, $365 million in casino contributions funded 10 statewide health and human services programs for senior citizens and people with disabilities,” said Bokunewicz.
“These programs include pharmaceutical, transportation and hearing aid assistance, as well as community-based programs for seniors.”
The casino industry also gives people a place to go, in other words, tourism. Atlantic City actually has a nice boardwalk and a few great restaurants, but people go for the glitz and the neon lights of the casinos. People bring money in and, depending on their luck at the tables or slot machines, usually leave it in New Jersey.
Bokunewicz almost equates it to having a professional sports team. A casino, or row of casinos, can transform a city into a destination.
“In 2021, Atlantic County, home of Atlantic City, was the top performing county in the state for both tourism visitation (20.3 million visitors) and visitor spending ($6.8 billion). Visitors to Atlantic County represented 21% of total visitation in the state and 18.3% of total visitor spending.”
So when the revenue reports come out each and every month, remember that some of that money is coming back to you, and when things are good, it’s good for you too.