ATLANTIC CITY, NJ – Amid a new push to ban smoking in Atlantic City casinos, a new report released Wednesday predicts it could cost up to 2,500 casino jobs and nearly 11% of revenue casinos as they struggle to recover from the coronavirus pandemic.
Independent gambling research firm Spectrum Gaming Group compiled the report which backs up the casinos’ longstanding claim that eliminating smoking would hurt their business, rob New Jersey of tax revenue and put thousands of unemployed people.
The New Jersey Casino Association commissioned the report, which did not recommend whether or not to ban smoking, an option that is gaining renewed support in the state legislature. New Jersey Democratic Gov. Phil Murphy said he would sign a smoking ban if a bill passes.
Among other findings, he determined that smokers, who make up 21% of Atlantic City gamblers, are worth more to casinos than non-smokers in that they tend to lose more money and spend more on gambling. non-gaming items.
Joe Lupo, president of Atlantic City’s Hard Rock Casino and Casino Association, said Atlantic City “is facing some very serious issues.”
He said casino employment and visitation to Atlantic City were both at 20-year lows and in-person gambling revenues had yet to return to pre-COVID levels, in decrease of 5% in 2021 compared to 2019.
“Now is not the time to pass a smoking ban,” he said, adding that it “could have a devastating effect on the community and the state.”
Lupo said Atlantic City casino executives were scheduled to speak with the governor this week about their concerns.
Smoking is permitted on 25% of the Atlantic City Casino floor. Casinos say banning it would scare smokers to neighboring Pennsylvania, where many casinos allow smoking.
A group of Atlantic City casino workers, aided by national non-smoking groups, have been pushing for more than a year for New Jersey to close the loophole in its public smoking law that allows it to continue in the casinos; it is prohibited in most other indoor spaces.
They complain of developing respiratory ailments and other harm from breathing in second-hand smoke, despite casinos investing millions in filters and air-purifying technology.
Legislation to end smoking in casinos died in last year’s legislative session but was reintroduced this year and garnered bipartisan support, including from a former governor, Democratic Senator Richard Codey.
Atlantic City briefly banned smoking for four weeks in 2008, but unhappy with the results, quickly reinstated it to the current level of 25%. In the first week of the ban, casino earnings fell 19.5%, according to casino workers union officials and state regulators.
The report claimed that between 1,021 and 2,512 jobs could be lost in the first year of a smoking ban in Atlantic City. Spectrum used data from 2019 which found that each casino job was supported by $155,008 in gambling revenue.
They also interviewed casino executives, employees and customers, as well as anti-smoking advocacy groups, and studied the experience of other states that have banned smoking in casinos.
At the high end of its projections, the report says 10% of Atlantic City’s casino workforce could lose their jobs if smoking is banned.
He also found that with a smoking ban, non-gaming revenue would drop by up to $93 million, or 6.5%, and tax revenue would drop by up to 44%.
The report also acknowledged that some non-smoking patrons would be more likely to visit casinos if smoking was banned. But the report found the extra activity wouldn’t be enough to offset an overall decline in game revenue.
He doesn’t expect every smoker to stop coming to Atlantic City casinos if smoking is banned. About 13% of smokers would still visit casinos, according to the report, and they also have the option of gambling online.
But that would hurt casinos: the report says casinos keep less than 10% of online gaming revenue, with the rest going to online operators, technology partners and associated costs.
Follow Wayne Parry on Twitter at @WayneParryAC