March gaming numbers cause concern for brick-and-mortar casinos

New gaming numbers released April 18 by the New Jersey Division of Gaming Enforcement showed a mixed bag of trends for the state’s gambling market.

While the sports betting industry continued its meteoric rise, with wagers breaking the $1 billion mark ($1.12 billion) for the sixth time, seven of the state’s nine casinos continued to lag behind their-in person, pre-pandemic revenue levels.

Casinos reported $423.7 million in total gaming revenue for March, which is a 17.9% increase from last March’s $359.3 million. However, brick-and-mortar figures show a different side of the equation. Casinos reported $216.6 million in-person revenue, which improved on February 2022’s numbers, but fell short of pre-pandemic levels. In March 2019, casinos posted $223.2 million in revenue.

The snapshot reflects a complicated situation as casinos emerge from the pandemic.

“With such a strong start to the year we have every reason, barring as yet unforeseen complications, to expect 2022 to set new near-term records for total records for total annual gross gaming revenue,” said Jane Bokunewicz, faculty director of Stockton University’s Lloyd Levenson Institute of Gaming, Hospitality and Tourism. “However, operators may still struggle to gain ground on pre-pandemic 2019 in terms of brick-and-mortar gaming revenues. Market pressures such as gas prices likely had an impact on March 2022 totals, which fell short of 2019. In comparison, January and February 2022 each exceeded 2019 single brick-and-mortar revenue totals.”

Casino operators say the sports betting wager numbers are a bit of mirage to their bottom line since only $66.4 million of that mind-blowing figure will be kept as revenue after paying off winning bets, third-party partners and other expenses.

Only the Hard Rock Hotel & Casino Atlantic City and Ocean Casino Resort are winning more in-person than they did before the pandemic.

One more positive trend comes from internet gambling, which produced a month of record revenue, taking in $140.7 million.

Atlantic City officials are preparing for a big boom this spring and summer as more and more people return to a sense of a post-pandemic normalcy. And officials and operators say that one of the main struggles on the premises is the labor shortage, which has hit the hospitality industry particularly hard.

“One indicator that has been slow to recover from the pandemic is casino employment,” Bokunewicz said. “As the industry heads into the summer season, traditionally a period with higher demand for in-person gaming, we will begin seeing the restoration of some casino jobs in the city. But it is unlikely to result in pre-pandemic levels of employment, at least in the short term.”