Operator News
US – Atlantic City smoking ban could result in 2,500 job losses
By Phil - 28 February 2022
A smoking ban on Atlantic City casinos could cause a loss of up to 2,500 jobs and have a significant economic impact on the State of New Jersey, according to new analysis by Spectrum Gaming Group, an independent research and professional services firm.
The report concludes that approximately 10 per cent of the Atlantic City workforce is at risk if a smoking ban were enacted, resulting in the potential loss of between 1,000 and 2,500 jobs, along with a substantial decline of up to 10.9 percent in gaming revenue, up to $93 million in non-gaming revenue, and a loss of between $17.2 million and $44 million for the State of New Jersey and the City of Atlantic City in tax revenue.
“The Atlantic City casino industry is the economic backbone of South Jersey. A smoking ban would result in a decline in customers, which would cause job losses, a decline in gaming revenue, and a decline in tax revenue that benefits the state and local economy, as well as New Jersey seniors and persons with disabilities. This independent report was commissioned to ensure a complete understanding of the ramifications of a ban on the city and the region,” said Joe Lupo, president of the Casino Association of New Jersey (CANJ). “Now is not the time to enact a smoking ban: employment at our casinos is at a 20-year low, with less than 50 percent of the workforce from 2003. Visitation to Atlantic City is at a 20-year low. Atlantic City land-based casino revenue has yet to return to pre-COVID-19 levels, seeing a 5 percent decline in 2021 compared to 2019, and adding a smoking ban could cause a devastating effect to the community and state.”
As many as 2,512 jobs lost: approximately 10 per cent of the casino workforce. There is likely to be up to 10.9 per cent decline in gaming revenue and up to $93m, or 6.5 per cent, decline in non-gaming revenue for casinos
This could lead to to $44m decrease in tax revenue, including $25.7m decrease in revenue to the Casino Revenue Fund, which benefits programs for seniors and disabled New Jerseyans.
There could also be an up to $4m decrease in the former CRDA obligation which now is provided to the City of Atlantic City for its budget and debt service
“This new report clearly demonstrates that a smoking ban would have long-term financial implications for the industry and the region, placing Atlantic City casinos at a competitive disadvantage with Pennsylvania casinos where smoking is permitted,” Lupo added. “The Association recognizes the concerns of our employees and others who advocate the elimination of smoking in our properties.”
The Spectrum report, Potential Impacts of an Atlantic City Casino Smoking Ban on Gross Gaming Revenue, estimated that approximately 21 percent of Atlantic City visitors are smokers, a percentage that is about 8 percentage points higher than in the general population. Based on that, the effects of smoking bans in other jurisdictions and other factors, Spectrum estimated the economic impacts of a potential complete smoking ban in New Jersey casinos but offered no opinion or recommendation as to whether smoking should be discontinued on casino floors.
“The casino industry has taken significant steps over the years to create a healthier environment for employees and patrons, including limiting smoking to just a fraction of the floorspace,” Lupo explained. “We understand this is a difficult issue, but it is important that we create a welcoming and inclusive environment for all of our guests, which include smokers and non-smokers.”
Atlantic City casinos currently permit smoking on only 25 percent of the gaming floor, compared to Pennsylvania and other jurisdictions that permit smoking at 50 percent or more. Further, the industry has invested in state-of-the-art filtration systems that circulate fresh air. When the COVID-19 pandemic began, the casinos had independent experts review their air filtration systems, confirming their effectiveness in exchanging large volumes of air to help maintain positive air quality for patrons.
