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Execs: US casinos learned some useful lessons from pandemic

91ƵSince we reopened, business has been terrific91Ƶ
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A man plays a slot machine at the Hard Rock Casino in Atlantic City N.J. on Aug. 8, 2022. On Sept. 16, 2022, New Jersey gambling regulators reported that the state91Ƶs casinos, horse tracks that offer sports betting and the online partners of both types of gambling outlets won $470.6 million from gamblers in August, up nearly 10% from a year earlier. (AP Photo/Wayne Parry)

The COVID pandemic forced most U.S. casinos to close for months, causing payrolls, revenue and earnings to tumble.

But the forced shutdowns and highly regulated recoveries also taught the industry useful lessons that will endure even after the pandemic is a distant memory, panelists at a major casino conference said Thursday.

Speaking at the East Coast Gaming Congress, executives from major gambling companies said the changes they were forced to make because of the pandemic had some benefits.

91ƵWe learned lessons that can91Ƶt be unlearned,91Ƶ said Thomas Reeg, CEO of Caesars Entertainment.

91ƵIt forced us and gave us the ability to say to our guests that things that used to be viewed as an entitlement, maybe they don91Ƶt need them as much as they thought they did,91Ƶ added Jim Allen, chairman of Hard Rock International. 91ƵDo you need a buffet? Should you have a buffet?91Ƶ

The conference was held in the Hard Rock casino in Atlantic City, whose buffet is still operating. Some of Hard Rock91Ƶs casinos in other states, including Florida, offer buffets while others do not.

David Cordish, chairman of the Cordish Companies, which operates casinos in Pennsylvania, Florida and Maryland, said the pandemic offered his business an opportunity 91Ƶto tighten the ship.91Ƶ

91ƵWe have not gone back to buffets,91Ƶ he said. 91ƵIt certainly wasn91Ƶt fun. Being closed for months was horrendous for employees. But there were a lot of lessons learned.

91ƵWhat we did 91Ƶ and we may need to do it again 91Ƶ is when we were shut, we put in every possible type of health and safety screening you could do,91Ƶ including hand sanitizers and barriers between player positions at table games, measures that were commonly adopted at casinos across the country.

Cordish said those expenses paid off handsomely once the casinos were allowed to reopen in mid 2020.

91ƵPeople were fed up with being cooped up and came pouring back to the casinos, particularly when we did these things,91Ƶ he said. 91ƵSince we reopened, business has been terrific.91Ƶ

Eric Hausler, CEO of Greenwood Racing, which owns Pennsylvania91Ƶs Parx casino, said the pandemic opened his eyes to one particular liability.

91ƵWe had a restaurant that was open every day for lunch and never made any money,91Ƶ he said. When the casino reopened after its pandemic-related closure, 91ƵWe didn91Ƶt bring it back, and no one ever said a thing about it.91Ƶ

Jeff Gural, who owns two racetrack casinos in upstate New York, had a similar experience.

91ƵWe had a Subway sandwich place that didn91Ƶt work,91Ƶ he said. 91ƵThen we converted it to a pizza place and that didn91Ƶt work. Someone suggested converting it to a sushi place 91Ƶ and I don91Ƶt like sushi. And it succeeded.91Ƶ

Gural also said closure helped him realize that spending big money on broadcast ads, billboards and car giveaways wasn91Ƶt bringing in the return he expected, making it easier to scale back spending on such things.

Daily housekeeping of casino hotel rooms has become another casualty of the pandemic in some places. In June, Atlantic City91Ƶs main casino workers91Ƶ with the state that four casinos were failing to clean guest hotel rooms daily as required by law, and one admitted it did not have enough housekeepers to clean every room every day.

Hospitality industry leaders say the combination of a shortage of housekeeping workers and the reluctance of some guests to allow hotel workers into their rooms during their stay has led to the abandonment of a daily room cleaning standard in resorts across the country.

One lingering effect of the pandemic is smaller payrolls. This is due both to workers who were let go during or shortly after the closures and have not been rehired, and a continuing difficulty in attracting new workers across the gambling industry, as with many others.

Jayson Guyot, president and CEO of Connecticut91Ƶs Foxwoods Resort Casino, said he ordered a complete restructuring of the business from top to bottom during the closure91Ƶ something that would have been difficult to do had it still been operating.

91ƵIt enabled us to rebuild our margins from 10 to 13% to 18 to 20% now,91Ƶ he said.

But he also voiced a common concern: Foxwoods has not yet returned to its pre-pandemic business levels.

That is a major preoccupation for Atlantic City91Ƶs casinos, which collectively have yet to return to 2019 revenue and profit levels for in-person gambling.

Second-quarter earnings, , show that five of Atlantic City91Ƶs nine casinos failed to exceed their pre-pandemic profit levels, and the resort as a whole saw a decrease in profits of nearly 1%.

Atlantic City has thousands less casino workers than it did before the pandemic struck. It, like virtually every other casino market, has struggled to attract new workers and retain existing ones.

Hard Rock recently made headlines by spending $100 million to give big raises to 10,000 non-tipped workers, most of them in the U.S. Other companies have given smaller raises recently. Foxwoods has raised its hourly minimum wage from $10.50 two years ago to $14.50 now, Guyot said.

91ƵWayne Parry, The Associated Press





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