At the start of the year, very few people would have imagined a worldwide lockdown and the subsequent economic ramifications. But the pandemic did hit us all and industries like tourism and casinos are some of the badly affected.
Impact Of Covid-19 On The Casino Industry
The gambling industry involves a large number of people on close premises playing a multitude of slots and table games. With the pandemic forcing such premises to shut down. Since March 17, the losses have been quite heavy.
Caesars, an entertainment company has estimated a daily cash burn of $9.3 million since the shutdown. It’s not just the Caesars. Every company in the gambling industry has had to resort to pay-cuts, furloughs, and several other mitigations to help cope with the situation.
While companies like Scientific Games took some cost-cutting measures, others like Inspired Entertainment have been forced to close down all their land-based customer locations and look for methods to repair their current revenue model with a focus on balance and liquidity.
The impact of such large scale casino closures has been a big blow to local communities and the workforce. In the US, this has resulted in a whopping loss of $74 billion in annual total wages for workers and their families.
The casino industry is vital to the development of local businesses like restaurants and small shops, which are now doomed to face a huge loss. Two months of inactive casinos mean a loss of $43.5 billion for the US economy alone.
The situation is more or less the same in European countries and other gambling markets. In the UK, land-based casinos account for about £1 billion annual revenue which has had a sharp decline this year. Sports betting has also come to a complete halt for the last few weeks amounting to even more losses.
European companies like LeoVegas, Gaming Innovation Groups, and such have taken mitigating actions and safeguarding their workforce while focusing on their online products for generating revenue.
With stricter social distancing and safety guidelines in place, online gambling has been the only part of the gambling industry that has enjoyed a level of growth during the pandemic.
When Are Casinos In Europe, USA, And Canada Opening?
Casinos in the US have started reopening their services from the first week of June under a phased reopening process. Las Vegas reopened casinos in the first week of June and has resumed its services.
Surprisingly, amid strict guidelines and safety measures, people can be seen flocking to the casinos with a great deal of enthusiasm. Casinos are mandated to run with only 50% occupancy, follow periodic temperature checks, and set up other safety measures like sanitising stations and proper social distancing while people are playing.
Casinos in each market across the US are expected to follow the safety guidelines imposed by the corresponding governing agencies. These restrictions include banning food courts, poker rooms, concerts, setting player capacity limits for table games, and other practices that promote proper social distancing.
As for Canadian casinos, the shutdown continues at places like B.C while all casinos in Alberta resumed their operations since June 11 with strict safety measures in place.
UK casinos are set to see the light a little later starting July 4th. The date is tentative and could be deferred if the pandemic worsens. For most other parts of Europe, entertainment and service industries like the gambling industry are expected to resume by June 15 with strict impositions on safety guidelines on masks and social distancing.
Long Term Consequences
The pandemic is yet to let loose its grip on the gambling industry, but we can hope that eventually companies will prevail and continue to operate. But the repercussions of the pandemic and the lockdown for the last few months is sure to leave its mark.
An economically recessive period is expected to affect all scales of businesses following the pandemic. Besides the recession, consumer behaviour and preferences would also witness a marked change with more people willing to opt for online modes of services.
The gambling industry also needs to understand such shifts in customer focus and take remedial actions like increasing their revenue over online markets and facilitating faster digital transactions to make up for the possible shortcomings from physical casinos.