Pennsylvania and Atlantic City casinos aren’t immune to labor shortages and the ongoing effects of coronavirus. Casino hotels had the largest decrease in employment among private industries, more than 3.5-times the next largest job loss industry.
At the recent American Gaming Association’s State of the Industry event, it was officially announced that commercial gaming revenue hit a record-high $53 billion, marking the first time the industry ever surpassed the $50 billion threshold for winnings.
Fueling record numbers and fast recovery from the pandemic-related shutdowns were the legalization of sports betting and online casinos along with the expansion of retail casinos.
But the report wasn’t all aces. Is the labor shortage an instance where the house doesn’t always win?
When AGA President and CEO Bill Miller talks with casino CEOs they always bring up two major issues.
- How hard the hiring process is from recruiting new employees to hiring back former ones.
- Supply chain issues.
“The pandemic hurt everyone. Mentally, the perspective around work has changed,” said Miller. “We have to do what we can to make our industry accommodating and welcoming to a significant group of people. It is a challenge.”
Miller explained that supply chain and labor shortages are related.
“All of these things contribute to the tightness that exists in the industry. You’re seeing triage operations where casinos will have one of their restaurants closed because they don’t have enough service staff to work at all of them. I think people are getting past COVID. Getting people to feel comfortable at a workplace that is face-to-face is going to take time and it’s one of largest challenges that all of us in the hospitality industry face. It’s going to remain a challenge at least into the near future.”
Casinos facing worker shortage
Case numbers are decreasing; however, the virus has a lingering impact. According to an estimate from Katie Bach, a nonresident senior fellow at the Brookings Institution, 1.6 million workers could be missing from the labor market right now because of long COVID, accounting for upwards of 15% of unfilled jobs.
Former casino industry executive turned university instructor and casino consultant, Robert Ambrose said:
“I think they (Atlantic City and Pennsylvania casinos) do have a labor problem. Many times they won’t admit it, but I think they do.”
Is it the biggest labor problem he’s ever seen?
“Based on my experience, yes. I focus the answer on the front-line positions. There is an issue there. Entry and mid-level positions (slot attendants, slot supervisors, dealer, hotel front desk, housekeeping) are the backbone of the casino and it’s the hardest to staff. Without it, you can’t run a property well and service suffers.”
Vaccine mandate impacts Philadelphia casinos
In early January, Philadelphia’s vaccine mandate went into effect. To enter a casino in Philadelphia – Rivers Casino Philadelphia and Live Casino Philadelphia – you must show proof of vaccination. It also means that all employees must be fully vaccinated which presented another staffing hurdle.
Rivers Casino general manager Justin Moore told Tino Magnatta, host of Casino Update, that when the mandate started, 170 employees were furloughed because they had not been vaccinated. Now, only about 80 are on furlough.
Right after the Christmas holidays, Moore said Rivers Philadelphia experienced a “tremendous” amount of cases of employees out with Omicron. It matches up to the city of Philadelphia’s overall numbers as cases began to rise in January, peaking on Jan. 12.
Moore said, “Business normals are about 30% down.”
Rivers Casino Philadelphia, and all PA casinos, have been on a big hiring push since capacity limits were lifted. On hiring efforts, Moore commented that Rivers Philadelphia is “pretty good” but the mandate weighs into decisions.
“Our volumes are so impacted by the mandate, I have to be careful in some areas how much staff I have because there isn’t a need for it. “
On Feb. 16, Philadelphia lifted the vaccine mandate. Proof of vaccination is no longer required to enter Live! Philadelphia or Rivers Philadelphia.
No mandate at the other end of the state
Across the state at Hollywood Casino at The Meadows, General Manager Anthony Frabbiele told Magnatta they also dealt with a major post-holiday Omicron surge.
“It seems like it’s cresting but it did rip through everywhere and it ripped through our communities. Hopefully, we are getting to the point it’s going to curve down.”
However, unlike Rivers, Hollywood Casino at The Meadows and casinos outside of Philadelphia do not have a vaccine mandate for guests and employees and it’s reflected in business levels.
“We are right where we think we should be. I don’t think people are concerned about being in public. People realize this is a part of life and they have to be smart about it.”
“We do not feel safe”
Harrah’s Casino Philadelphia is located in Chester which is not subject to the city of Philadelphia vaccine mandate that went into effect on Jan. 3. In early January, a Harrah’s employee told PlayPennsylvania that they were seeing many new customers. The employee agreed to speak on the condition of anonymity.
“Harrah’s has not implemented any new safety measures to protect our employees and most are not happy about it. Players can walk in without a mask, no proof of vaccination required, and people even blow their germs all around the casino, and into the dealers’ faces and this is acceptable with COVID rates skyrocketing right now?
“Despite Harrah’s claim that employees’ and players’ safety is a top priority, actions speak louder than words. We do not feel safe. Many of our workers are getting COVID. We do not understand why smoking indoors is allowed, when it’s not allowed anywhere anymore. And with the spike in cases, we feel that masks should be mandated again.”
Pennsylvania lifted its universal masking order on June 28, 2021 and most PA casinos allowed smoking to return. However, Parx Casino and Mount Airy remain non-smoking. The topic of whether smoking should be permitted in casinos remains a contentious issue and one that will (probably) rage on after the vaccine mandate is lifted.
Why is smoking allowed at casinos?
Pennsylvania lawmakers approved the Clean Indoor Air Act in 2008. It banned smoking in public indoors. But there are exceptions for casinos, private clubs and cigar bars.
Casinos can allow smoking on up to 50% of the square feet of the gaming floor.
“Everyone is frustrated, everyone is stressed”
An Atlantic City casino worker told PlayPennsylvania in late January:
“Not only is there a shortage, but when you’re union in AC it’s especially hard. Overworked, business is slow, employees calling out because they are so overworked, employees still getting COVID. It’s been a disaster. It’s especially hard when you’re low in seniority, so you basically get mandated to work 15 hours. Legally they have to put 8 hours in between, but we’ve been so short that management tries to actually get around that. I’ve gotten sick (not COVID) twice from being so overworked.
“When they also hire new people in food and beverage, they never stay. They go through the two-week training process, must realize that they are now low in seniority, and they’ll be working 15 hours as well. Management has also completely lost the humanity and empathy for their employees as well. Screwing up schedules, not working by seniority, the amount of grievances against them just piling up. Everyone is frustrated, everyone is stressed. “
Some had to reapply
Employees at Valley Forge Casino were furloughed at the start of the coronavirus pandemic. A now-former Valley Forge Casino employee who worked in a restaurant at the property shared their experience with PlayPennsylvania. In July 2020 they were laid off and told that if they wanted to return in the fall, they would have to reapply.
“Everyone was mad about that (reapplying). It was a bunch of crap.”
The former employee did reapply; however, their schedule did not match the casino’s needs.
“If I didn’t have to reapply, I would have gone back if it was my same shifts. I planned to go back,” said the former Valley Forge employee who now works at another job not in the gambling industry. “The food and beverage industry is crazy right now. It is a hard job. You have to like what you are doing.”
Reasons for casinos staffing problems
What are some of the reasons contributing to casinos’ hiring woes? There are various factors.
The Great Resignation
“Quit rate,” the number of workers voluntarily leaving their jobs, across all industries hit an all-time high. Service industries which include hospitality and food service have the highest rate of any sector.
The pause
This could also fall under the Great Resignation. During shutdowns, many people had time to pause and think.
“Some people took the pause when casinos closed (at the start of the pandemic) and they may have reevaluated their interest level in going back into that environment. A lot of people went into other industries or started their own business and did not return to the industry. Working in a casino is a hard job,” said Ambrose.
More casinos, widespread legalization of sports betting
With online sports betting being legalized in more states like New York, IT employees are leaving brick-and-mortar casinos to work for sports betting and iGaming operators.
Since Feb. 2021, three casinos have opened in Pennsylvania – Live! Casino Philadelphia, Hollywood Casino York, and Hollywood Casino Morgantown – and the talent pool for employees is only so deep. A Parx mini-casino in Shippensburg is scheduled to open in the fall of 2022. Also, nearly every other industry is hiring and the competition for workers is fierce.
So over it
Over half of hospitality workers would not go back to their old jobs and a third aren’t even thinking about going back to the industry. A survey revealed that “no pay increase or incentive would make these workers return to their previous workplace.”
“Even though we hear a lot about the minimum wage going up, there are a lot of positions that rely on tips,” commented Ambrose. “We’ve seen people having to decide if they take a tipped position or a position with Amazon for $15 an hour and go work in a warehouse. A lot of non-gaming/hospitality industries have also raised the stakes in salaries and hiring bonuses. Competition for employees is massive.”
But it isn’t all doom and gloom for the casino industry. Ambrose is an adjunct professor at two universities and they have developed an online hospitality certificate program that is getting a great deal of traction.
“The interest level is there,” Ambrose says.
Adjusting
Ambrose pointed to an Atlantic City casino that used to employ a technical staff in the slot department of 30-40 slot technicians. Now, they are operating with five. If things don’t get fixed, the games stay down until someone gets to it.
In part, it’s because the properties want it that way (a smaller-sized staff). Technology has impacted some positions, such as self check-in; however, there are still some positions they just can’t fill.
How many jobs offered versus filled at PA casinos?
The average base salary for a casino dealer in PA is $12.73 plus about $35 per day in tips according to the most recent report from Indeed.
The Pennsylvania Gaming Control Board released its annual Diversity Report in October 2021 for the fiscal year 2020/2021. It gives an overall look at PA casinos’ labor force and it showed the impact of labor shortages. Each casino reported positions offered and positions hired.
| Casino | Positions offered | Positions accepted |
|---|---|---|
| Harrah's Casino | 236 | 202 |
| Hollywood Casino at The Meadows | 147 | 105 |
| Hollywood Casino at Penn National | 332 | 96 |
| Lady Luck Nemacolin | 563 | 444 |
| Live! Casino Philadelphia | 2,422 | 1,568 |
| Live! Casino Pittsburgh | 1,000 | 811 |
| Mohegan Sun Pocono | 94 | 94 |
| Mount Airy Casino | 378 | 219 |
| Parx Casino | 905 | 352 |
| Presque Isle Downs | 153 | 153 |
| Rivers Casino Pittsburgh | 588 | 180 |
| Rivers Casino Philadelphia | 542 | 241 |
| Valley Forge Casino | 214 | 165 |
| Wind Creek Casino | 638 | 168 |
Atlantic City casinos summer staffing needs
Atlantic City and the rest of the Jersey shore rely heavily on the Summer Work Travel program which brings college students from overseas to New Jersey to fill summer jobs. The J-1 visa program is critical to Atlantic City casinos as it allows them to fill entry-level positions during peak summer months when there is not nearly enough locals to fill the staffing needs. However, with the pandemic, there have been visa processing delays.
The temperatures are currently hovering around freezing in Atlantic City, but they are already thinking of the upcoming summer months.
“Across the board both in Atlantic City and other jurisdictions we are seeing property websites building up their hiring lists of open positions,” said Ambrose. “Where technology has not replaced positions, we are also seeing bonus pay being offered, increased salaries for seasonal employees, for tipped employees a more guaranteed base salary, more flexible scheduling as well as other perks to get people on board.”
Human resources executive offers insight on casino worker shortage
Donald P. Hoover was an executive human resources director at an Atlantic City casino for twenty years. He is now an HR consultant and serves as the Associate Director of Enrollment at the International School of Hospitality, Sports, and Tourism Management at Fairleigh Dickinson University.
Casinos, ultimately, face the same labor shortages and recruitment issues as every other business.
He pointed to the December unemployment rate in PA (5.4% in December) and New Jersey (6.3%). Also, “pandemic-related churn” was caused when casinos made the difficult decision to lay off workers at the start of the pandemic.
“I believe that the layoffs challenged the ‘loyalty covenants’ that were implied between workers and employers. Many employees laid off due to business demand were long-term workers. In many cases, workers were shaken and shocked by circumstances beyond their control and have sought careers that are ‘pandemic safe’ and in sectors where remote work options were more available.”
Retention is the best recruitment strategy
Casinos in Pennsylvania and Atlantic City have been on an aggressive hiring push for over a year. Rivers Casinos raised the minimum wage to $15 per hour for non-tipped employees. There are postings for jobs touting signing bonuses and other incentives.
However, Hoover says new employees should not be the main focus when it comes to incentives.
“Because of the lower than average unemployment rates and the increased competition for talent, wages and other incentives will naturally increase. The No. 1 recruitment priority for employers is to keep their talented workers. I have seen numerous signing bonuses and incentive packages offered to new employees while the existing workforce had no incentives. When considering compensating new hires with incentives, existing workers must be considered in the process. Compensating current workers with the new hire bonus for every person they ‘recruit’ is a technique that could be considered.”
It also isn’t just about wages, Hoover explained. The total package – healthcare and paid time off – must be considered attractive enough to recruit and retain top talent.
