It’s Christmas in July for Pennsylvania Casinos, But Not for Workers
Posted on: August 18, 2020, 08:12h.
Last updated on: September 2, 2020, 10:20h.
The Pennsylvania gaming industry posted a year-over-year revenue increase in July, the surprising uptick largely the result of a surge in online casino play.
The first online casino in the Keystone State went live in mid-July 2019. With July 2020 arriving amid a pandemic, and Pennsylvania continuing to limit food and beverage services and keeping casino occupancy capped at 50 percent, the internet gambling platforms welcomed in a bounty of new customers.
The 10 Pennsylvania online casino operators reported gross gaming revenue (GGR) of $54.35 million. That’s up from $812,306 in July 2019, when only three casinos had launched their interactive online platforms.
Online gambling was the reason for July 2020 recording a year-over-year GGR increase. Combined with operations from brick-and-mortar, sports betting, video gaming terminals (VGTs), and fantasy sports, the Pennsylvania gaming industry won $283 million — a 0.56 percent premium on the same month in 2019.
Now The Bad News
Pennsylvania’s 12 land-based commercial casinos were in operation for all or most of the month for the first time since they were ordered to close by Gov. Tom Wolf (D) back in mid-March. But while internet gambling is bridging the revenue gap caused by the coronavirus, that doesn’t mean it’s protecting jobs for those who work at the land-based venues. Online operations require fewer jobs than retail casinos.
This week, Mohegan Sun Pocono in Wilkes-Barre informed 240 of its furloughed employees that they are facing a permanent job loss. Companies are required under the federal WARN Act to give workers a 60-day notice regarding potential mass layoffs.
Mohegan Sun Pocono GGR in July was up 2.6 percent on the previous year, casino win totaling $19.5 million. However, its brick-and-mortar slot win was down 11.6 percent to $14.8 million, and table game revenue down 27.6 percent to $1.9 million.
The Pocono casino’s year-over-year increase was a result of its $2.8 million in internet play, plus a $240,000 bump from sports betting.
Mohegan Sun Pocono isn’t the only Pennsylvania casino mulling permanent reductions in its workforce. In June, several casinos filed WARN notices.
Penn National Gaming, owner and operator of Hollywood Casino, says 64 furloughed workers could become permanently laid off. The Meadows Race Track and Casino is mulling 180 permanent terminations and Valley Forge Casino 300 positions.
The nearly three-month closures of Pennsylvania casinos didn’t hurt only the operators and employees, but also the state. As Casino.org reported earlier this month, the government missed out on $424 million in lost tax revenue from gambling.
Slot machines are taxed at a rate of 54 percent, and table games at 16 percent. The bulk of the tax money is set aside for property tax relief, the horse racing industry, economic development, and the state’s General Fund.
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