Casino industry notches small gain in 2010 after declines, report says
2010 Nevada commercial casino stats
- Number of operating casinos: 256 (FY 2010)
- Casino employees: 175,024
- Casino employee wages: $7.816 billion
- Gross casino gaming revenue: $10.40 billion
- Gaming tax revenue: $835.42 million
- How taxes spent: Education, local governments, general fund, problem gambling programs Legalization date: 1931
- First casino operating date: 1931
- State gaming tax rate: Graduated tax rate with a maximum tax of 6.75% on gross gaming revenue; additional fees and levies may be imposed by counties, municipalities and the state, adding approximately 1% to the tax burden
- Mode of legislation: Legislative action
- Visitor volume: 49.99 million
After two years of declining revenues, the U.S. casino industry showed more stable results in 2010, according to an annual report released today by the American Gaming Association. Gross gaming revenue from commercial casinos totaled $34.6 billion in 2010, a nearly 1 percent increase from 2009.
The AGA this morning released its “State of the States” results, a survey that looks at how the commercial casino industry was affected last year through national and state economic data, as well as public opinion results. The 2010 survey combined the 22 states with commercial casinos and those with racetracks, which AGA President and CEO Frank Fahrenkopf said gives a more accurate depiction of the industry.
“Clearly, a 1 percent increase is not indicative of a complete recovery. This recovery is going to be slow and laborious, particularly because the national economy is still struggling to fully emerge from the recession. As consumer discretionary spending goes, so goes our industry. We’re not out of the woods yet, but this modest increase coming after two years of declining revenues is significant,” Fahrenkopf said on a conference call today discussing the results.
Consumer spending at Nevada casinos increased slightly in 2010 to $10.4 billion from $10.39 billion in 2009. Of the 21 states that had commercial casinos or racetracks in 2009, 14 saw increases in consumer spending during the year-over-year period, the report indicated.
Once again, New Jersey took the biggest hit in 2010 with a decline of 9.4 percent in consumer spending, but maintained its second-place spot behind Nevada with $3.94 billion in revenue. The Atlantic City market has been one of the most affected by the recession as it struggles with declines in consumer spending and increased regional competition.
“The varying increases and decreases from state to state show that the industry is far from monolithic,” Fahrenkopf said.
Pennsylvania, which had its first casino opening in 2007, saw the largest increase, at 26.4 percent. Fahrenkopf said the growth was mostly due to the introduction of table games in the state and the addition of the Sugarhouse Casino in Philadelphia in September 2010.
Fahrenkopf compared the growth in Pennsylvania and its ability to surpass Atlantic City to that of Asian markets and Las Vegas. The two hotel-casinos in Singapore have been open less than a year and may soon overtake revenues on the Strip in a short period of time, he noted.
But in the U.S, the Las Vegas Strip was the top U.S. gambling market, bringing in $5.77 billion in 2010, an increase of about 4 percent from 2009. The Boulder Strip area slipped from No. 10 to No. 11 on the 2010 list with $757 million in revenue. Downtown Las Vegas fell from No. 18 to No. 20, bringing in $493 million in revenue.
Nevada had more than 175,000 commercial casino employees in 2010, a 1.3 percent decline from 2009. According to the 2009 “State of the States” survey, Nevada saw a 12.3 percent decline in employment from 2008 to 2009, the largest decline of the states in the 2009 survey.
In total, the U.S. commercial casino industry employed 340,564 people in 2010, an increase from 328,377 in 2009.
The commercial casino industry contributed $7.59 billion in tax revenues in 2010, an increase 3 percent increase from 2009. Nevada returned $835.42 million in tax revenues in 2010, which is up slightly from the $831.75 million it contributed in 2009.
The “State of the States” report also included a section on public opinion on the casino industry. According to the survey, 31 percent of Americans visited casinos during 2010 and 25 percent said they gambled while there. Fahrenkopf said those visitation numbers stayed steady through the recession.
The survey indicated that of those who visited casinos in 2010, 73 percent said they ate at a fine dining restaurant and 56 percent said they saw a show or concert while at the casino. Others said they went shopping, visited a bar or nightclub or used recreational facilities such as the spa, pool or golf course.
“This is strong evidence that modern casino resorts are valued well beyond the gaming floor,” Fahrenkopf said. “They’ve become entertainment hubs for gamblers and non-gamblers alike.”