The US Gambling Industry Reels from the COVID-19 Pandemic

The commercial gaming industry in the United States suffered a major downfall in 2020 due to the pandemic. The American Gaming Association (AGA) recently put a number on the extent of the damage.

According to the official announcement, US commercial gaming operators lose over 31% of revenue compared to 2019. This is the lowest figure recorded since 2013. People are now looking to recuperate the damage to a certain extent in 2021.

Coronavirus Curse

The AGA recently posted revenue figures for the final three months of 2020, and the numbers plummeted by 16.5% YoY to $9.19 billion. The drop includes combined gross gaming revenue from table games, which decreased by 29.9% YoY to approximately $1.45 billion, and slots, which fell by 20.3% to $5.63 billion.

The AGA, however, confirmed that commercial casino operators recorded a 129.5% YoY growth in Q4 2020 thanks to sports betting revenue, which slightly rose to $860 million as iGaming revenue swelled by an impressive 185.3% to $484 million.

Commercial casinos were forced to reduce their operational calendar by 27% last year for a combined 124,882 days. For comparison, the figures were 170,484 days in 2019. Due to the heavy closures, the US commercial gaming industry generated about $30 billion by the end of the year.

A majority of the damage was recorded in the second and third quarters, while the fourth quarter brought in some respite. Commenting on the situation, Bill Miller, CEO and President of the AGA, said, “COVID-19 devastated the industry and our business. It jeopardized the livelihoods of our employees and communities that rely on casinos for survival”.

“We have persevered by supporting our employees, promoting responsible reopening, and lending a helping hand to the communities in need. These numbers, however, show the economic impact of the pandemic and highlight the importance of targeted federal relief and immediate vaccination drives to promote the gaming industry”, Bill added.

Silver Lining on the Horizon?

As the industry resumed operations last summer with certain restrictions, things have slowly started returning to normal. Around 911 of the 998 registered brick-and-mortar casinos in the US have resumed operations at the time of publication. Most of them, however, continue to operate at a limited capacity.

Nevada’s casinos were allowed to increase occupancy from 25% to 35% earlier this week. And even though more casinos are lined to reopen this year, a few might shut down permanently due to the lack of funds. The only good news emerging from the situation is despite the damage to casino operation, alternate gambling avenues have slowly emerged to help counter the losses to a certain extent.

The historic Supreme Court disregarding PASPA in 2018 turned out to be a major blessing in disguise as sports wagers immensely boosted the faltering revenue figures in states that regulated the market in the past couple of years. Sports betting revenue amounted to $1.5 billion last year, a 69% YoY increase. The iGaming industry added another $1.6 billion to the tally.