Massachusetts casinos were among the hardest hit businesses in the early days of the pandemic. When the state Gaming Commission tasked the UMass Donahue Institute with analyzing the economic impact COVID-19 had on the gaming industry, Donahue analyst Tom Peake said the institute had years of reports produced before the pandemic, to compare to.
Tom Peake, Sr. Research Analyst, UMass Donahue Institute: We started studying the economic impact back before the casinos even opened back in in 2014. So, we've put out a number of studies over the years about various topics around the economic impact of casinos. But certainly, when the COVID-19 pandemic hit, we wanted to do sort of an ad hoc reportto specifically study this topic.
Carrie Healy, NEPM: When that happened there were government ordered closures of casinos and then the inevitable layoff of workers and stoppage of work completely as people were asked to stay more or less in their homes in Massachusetts for a period of time. How did the casinos bounce back from that and was it even among them?
I wouldn't say that it's exactly even just because the dynamics and the various markets are a little bit different. And I would say that a lot of the way that they bounced back was really heavily dependent on regulations that the state and other authorities put in place. But you do see, as the regulatory environment changes in many ways, a lot of the casinos respond in similar fashions in terms of how they bounce back.
And bouncing back in terms of hiring; there were diversity components to original hiring (practices) at the casinos, years ago. How has that fared in the months since they have managed to stay reopened?
When the casinos got their gaming licenses, they made certain commitments in terms of hiring racial and ethnic minorities. Over most of the study period that we have, which we were really studying January 2020 to June 2021. For the most part, the casinos did manage to meet those goals, but there was a dip in the share of employees who were people of color.
I think in a big part, that dip can be explained by just looking at the racial and ethnic composition of various departments. Some of the departments that saw the heaviest layoffs, such as the hotels, food, and beverage, those are also the industries that are comprised most heavily of racial and ethnic minorities, whereas a lot of the central office administrative jobs at the casino, those departments tend to be more heavily white, I think largely just due to structural issues in our labor markets.
As a natural consequence of that, you're seeing that out of the people that are laid off, they are more diverse as a population than the people who aren't laid off. And just to be 100% clear, that happened at the casinos, but I would suspect that if we got this level of operating detail for a lot of establishments in Massachusetts, and across the United States, you would see a similar thing.
This report was commissioned by the Massachusetts Gaming Commission, who oversees gambling in the state. And at play at the Statehouse, currently, lawmakers are probably likely to approve sports betting. Other states have gone even beyond that and now operate mobile betting and internet betting. As we've seen how brick and mortar casinos in Massachusetts weathered COVID-19, how will other forms of betting at some point in the future in Massachusetts, likely affect employment and revenues at these casinos?
It's hard to say right now. As of the last time that we really looked at this, lottery spending didn't really seem like it had been heavily affected by the presence of the casinos. And so it's possible that these are sort of different markets, that the people who are going to be participating in sports betting, should we legalize it, might not be necessarily the exact same market of people who participate in casino gambling, but there could be some crossover.
And whether that means that somebody spends less on casino gaming or whether that just means they spend more of their money overall on a more diversified group of gambling expenses is something that I think we'll definitely be studying, but it's so hard to speculate right now. So many of the things that I think a lot of us speculated about, how this industry would play out and affect the region, turned out to be not exactly accurate. So, I think it's just it's very difficult to know for sure until we get an opportunity to observe.
