Gaming's $240 billion impact noted; Murren eyes fantasy sports

1 October 2014

LAS VEGAS -- The commercial and tribal gaming industries had a combined economic impact on communities where they are located of nearly $240 billion in 2013, according to a study conducted by the research arm of Oxford University.

The findings, released as the Global Gaming Expo (G2E) 2014 began its three-day run at the Sands Expo and Convention Center on Tuesday, marked the first time both the commercial casino industry and American Indian casinos were included together in one study.

The trade show and conference is expected to attract 27,000 attendees. The 300,000-square-foot trade show floor will have an estimated 480 exhibitors.

Oxford Economics found the two industries produced total revenue — gaming and nongaming — of almost $82 billion in 2013. When the revenue from gaming equipment manufacturers was added, the total jumped to more than $87.1 billion.

Nationwide, the industries paid out $38 billion in federal, state and local taxes, of which, $10 billion came directly from gaming, according to the report.

Worker income taxes, Social Security taxes, casino property taxes and other tax categories accounted for the rest of the total tax base.

Oxford Economics conducted the study for the Washington, D.C.-based American Gaming Association (AGA).

“Frankly, the numbers were greater than we ever imagined,” AGA CEO Geoff Freeman said. “The contributions from the gaming industry have long gone underestimated.”

Adam Sacks of Oxford Economics said the gaming industry is taxed at an average of 33 percent across the board. Oxford Economics was founded in 1981 as a commercial venture with Oxford University’s business college.

Freeman said the study would be shared with state and local elected leaders so they can understand the gaming industry’s reach. He also said the gaming industry will continue to be an economic engine if it is allowed continued expansion opportunities.

A ballot referendum in Massachusetts next month could halt the state casino expansion plans.

“Policymakers must work with industry leaders to craft policies that help maximize gaming’s ability to innovate, reinvest and contribute to local communities,” Freeman said.

According to the study, casinos nationwide employed more than 554,000 workers, which accounted for almost $26 billion in labor income. Gaming equipment manufacturers employed 164,000 workers and generated $1.1 billion in labor income.

In addition, the study found that off-site spending by casino patrons directly generated near 164,000 jobs in their local communities, which accounted for $6 billion in labor income.

All told, the study found the gaming industry supports more than 1.7 million jobs.

“More than the airline industry,” said Sara Rayme of the AGA.

The study was released at the same time four casinos have closed in Atlantic City, laying off some 8,000 workers. Freeman said the closures happened because casino competition from other states took away business.

During the opening keynote session, MGM Resorts International Chairman Jim Murren said he was considering an investment into fantasy sports leagues because of their growing popularity. Murren said the casino company might also provide the branding sponsorship for a professional soccer franchise.

Despite setbacks for legalizing sports wagering in New Jersey recently, Murren said the activity can’t be ignored.

“It’s obvious what’s happening,” Murren said. “Fantasy sports has become important and popular to society.”

In a panel discussion on gaming expansion in Japan, representatives of MGM Resorts, Caesars Entertainment Corporation and JCM Global said the industry was hopeful casinos will be legalized.

Union Gaming Group Managing Partner Grant Govertsen likened the effort to legalize casinos in Japan over the year to the “Peanuts” comic strip.

“Every time Lucy holds the football for Charlie Brown, she pulls it away at the last minute,” Govertsen said.

Related Links
Ranked Online Fantasy Sports Sites
Global Gaming Expo (G2E) 2014
American Gaming Association
JCM Global Gaming Vendor Information
Union Gaming Group Gaming Vendor Information

Copyright GamingWire. All rights reserved.