If investors in the casino industry expect a thriving 2020 and healthy gross gaming revenue in the Macau market, they may want to think things through.
According to Macau’s budget for 2020 released this past Tuesday, officials are not looking forward to major growth. Instead, the city budget for zero growth, as the officials are expecting the GGR to be approximately $32.2 billion. The authorities also expect a dismal $11.27 billion from gaming taxable income, a figure that was in this year’s budget.
Although the government in Macau tends to take a conservative when it comes to budgeting, the gaming industry performed poorly this year. Over the past 10 months of 2019, GGR was $30.57 billion, which is a drop of 1.8 percent. This is not what was expected, considering that the GGR in 2017 had gone up by 14 percent to $37.52 billion. A 5.8 percent growth was expected in 2019.
Last year marked the second time the City had experienced growth, which came in the wake of a severe 3-year drought. Compared the year 2016, last year, but one had 19.5 percent growth in GGR, and this had many analysts thinking Macau’s gaming industry had escaped the jaws of the dragon.
An untimely statement from Macau’s Gaming Staff Rights Association (GSRA) is expected to receive a lot of resistance due to this gaming forecast, and the local industry’s poor performance. The GSRA issued a press statement this past Tuesday in which they lobbied for an increase in wages by at least 5 percent for workers who serve gaming operators.
The labor activists want the government in Macau to impose pressure on operators to raise employee wages and offer bonuses for those who work night shifts. They also want the companies to impose a 5-day workweek, as stated in calvinayre.
Cloee Chao, head of MGSRA, informed the GGRAsia that during the time the city experienced a decline in revenue in the gaming industry, they were well aware of impeding poor conditions, and there were no pay hikes, which meant that the city bore the lose alongside operators. In the past few years, casino operators witness just 2.5 percent worth of pay hike each year.
Casinos in the city of Macau had been issuing annual pay hikes that vary based on the venue, employment longevity, and type. Most also provide bonuses, usually in the summer as well a winter bonus, equivalent to a month’s full salary.
Generally, earnings within the gaming industry went up 3.8 percent in 2019 and currently stand at $3045. Given the current state of affairs of Macau’s GGR, convincing operators to dish out a little more out of their coffers to workers may prove difficult.
Nevertheless, the labor activists will not relent in their pursuit to ensure workers have fair working conditions. While the increase has been a long time coming, because of a higher consumer price index in Macau, receiving a 5 percent pay hike is not realistic in 2019.
