On August 11, J. B. Pritzker, the governor of Illinois, signed legislation that permits convicted felons to work in non-gaming jobs in casinos. The legislation was supported by unions, casinos, and gaming regulators, with good reason. In 2019, Pritzker signed a law authorizing six new casinos in Illinois, bringing the total to 16. Those new casinos will need employees and therein lies a problem. By the time some of the new casinos were ready to begin operations, a pandemic occurred. COVID changed many things, among the most significant the availability of employees. There are not enough employees to staff the new casinos in Illinois, or existing casinos in Lincoln Land, or anywhere else.
The gaming industry is struggling to find staff. The law in Illinois was only one attempt by lawmakers and businesses to solve the labor shortage. Since 2021, seven states have lowered the age of alcohol servers and two more have introduced such legislation. Wisconsin’s bill would allow 14-year-olds to serve alcohol.
The labor shortage is affecting service levels. Hotels have altered their room-cleaning policies, cleaning rooms less often, sometimes only when a new guest arrives. Housekeepers are assigned more rooms to clean. Restaurants are forced to shorten operating hours, close more days of the week, and operate at less than full capacity.
Gaming tables are facing the same problems. Casinos in many jurisdictions have a limited number of table games available. It is a challenge and it is having an impact on profitability. Besides lost revenue opportunities, payroll expenses have gone up, squeezing the bottom line.
Filling the empty positions often means hiring inexperienced applicants. Service and entry-level jobs can be taught; some positions take only a few hours to learn. Table-game dealers, on the other hand, take weeks and casinos frequently set up their own schools, as Bally’s in Chicago has done. However, many positions require years to learn, while some require college degrees and sophisticated and lengthy apprenticeships. General managers, department managers, shift supervisors, surveillance, facilities engineers, purchasing, and accounting personnel are among positions that require formal training and experience. The situation is most challenging for new casinos.
The temporary Bally’s in Chicago could and did train its dealers, but its supervisors and managers came from elsewhere, ither from other Bally’s locations or competitors. Neither solution solves the problem in the long term; in fact, it adds to the gaming industry’s problem. Each time a person moves from one job to another, a position is left vacant. Sometimes an in-house candidate is promoted, but often candidates are recruited from competitors. It is an endless loop that only a larger labor pool can solve. The gaming industry is not alone in this dilemma.
Doctors, dental hygienists, accountants, police officers, teachers, IT professionals, sports officials, and pilots are among the professions without enough trained people to fill the available positions. The shortage is causing service levels to change, just as it does with hotels and restaurants. For example, schools are being impacted. Nationally, 900 school districts have altered schedules; some use an alternative-week schedule and others offer classes only four days or fewer days a week. Twenty-five percent of the schools in Missouri are operating on a shortened schedule.
The Reno school district says it has enough teachers this year. But it does not have enough bus drivers to transport the students or officials for athletic events. Football officials are short by 20 percent. Football games are scheduled on the traditional Friday night and Saturday, but other days as well. Some of the minor sports may not be able to take the field at all due to a lack of qualified officials. Other districts are doing what Wisconsin and Illinois are doing, lowering the qualifying standards. Although it is unlikely that 14-year-olds and felons will be teaching school anytime soon, high-school graduates who pass a qualifying test might. And people with degrees in any field are also being considered.
Air travel is another industry with a labor crisis. The fastest rising cost for airlines is payroll. Southwest reported that labor costs are 25 percent higher than last year. To retain employees, the airline is forced to raise salaries. American and United have agreed to raise pilot salaries by 40 percent over two years. Even with higher pay, United needs more pilots. It is spending $200 million to expand its Flight Training Center in Denver. Other airlines are paying for pilot training. It is estimated that internationally, there is a shortage of 30,000 pilots, with another 18,000 in the United States. Raising the pay is a short-term attempt to hold onto pilots. Training new pilots is a longer process.
The intense competition for pilots and other professionals is a major economic and societal problem. Finding solutions will not be easy. We might loosen our visa restrictions and actively recruit professionals from other countries. But the problem is international. It would not be easy to find 100,000 doctors or 18,000 pilots wherever we looked. We will have to get used to paying more for services, from restaurants to medical care. A USA Today article said that UPS drivers are getting a raise and will make $170,000. That is great news for UPS drivers, but terrible news for the rest of the economy.
The UPS story puts the problem of finding housekeepers, bartenders, waitstaff, and blackjack dealers in context. The competition for employees is going to get more intense and the cost of doing business will skyrocket. With the expansion of gaming, finding a blackjack table is getting easier. Finding a blackjack table with a dealer is getting harder.
