The casino gaming market has seen steady growth since the June 2016 quarter and there’s nothing to suggest that there will be a reversal in this growth trend. On the other hand, there are good reasons why growth should continue over the next few years.
A Little Government Support
The most important if unlikely of these is government support. The prospect of taxes (as high as 25%) on earnings is attractive and can be used by any welfare state to build schools, infrastructure and so forth. Besides, the industry employs a large number of people and therefore has an impact on the jobs market. So governments cross the world are moving to reduce restrictions on gambling.
The Chinese government crackdown on illegal fund transfers from mainland China to Macao was a big blow for the gambling business there. But new resorts with a focus on leisure rather than pure gambling are helping players return to the black. Gambling remains illegal in Brazil and Japan, but governments in both these countries are growing more receptive to the idea, which is a positive development for the industry.
Back home in Nevada, the government has been lowering restrictions and there’s a new bill that could lower the legal gambling age limit from 21 to 18 years. In some states and for some types of games such as bets on horse racing in Arkansas, Delaware, Florida, Indiana, Louisiana, Maine, New Mexico, Ohio, Pennsylvania and Washington, the legal age is already 18 years.
Tribal casinos in Alaska, Idaho, Minnesota and Wyoming are also legal for 18-year-olds. While the age group isn’t likely to have a lot of extra cash, this could expose them at an earlier age, potentially increasing revenue for the industry.
There’s also another aspect to legalization, which is the reduction of unaccounted for transactions resulting in black money. For instance, sports betting is illegal in most countries, although people spend and make millions from it. So this money often leaves the concerned country to safe havens.
A Little Extra Cash
According to numbers provided by the U.S. Bureau of Economic Analysis (BEA), the real disposable income has been rising through 2017. While it peaked in June and dropped off thereafter because of the impact of Hurricanes Harvey and Irma, it has been growing again since then and remains much higher than it was a year ago. While personal consumption has also been rising (most of the increase is in food and energy), the trend is positive for the gaming market overall because it indicates that people have more money to spend on leisure.