Forecasts indicate economic headwinds are on the horizon, but a new report from the American Gaming Association (AGA) indicates casino operators are actually optimistic about the rest of 2022. While casinos in the US have thrived while other industries struggled during the pandemic, there is reason to expect the industry eases moderately going into 2023.
Looking at the AGA Current and Future Conditions Indexes
The AGA presented the Gaming Industry Outlook in tandem with Fitch Ratings to present both the Current Conditions Index and the Futures Condition Index. The former number peaked at over 120 back in Q4 of 2020, but came back to earth and currently stands at 99.5 (any number over 100 indicates growth). The Futures Condition number is slightly less positive at 95.3, which is largely the result of a projected mild recession in 2023. Here is a look at both Conditions historically, which date back to 2007:
Polled gaming executives remain optimistic about economic future
In spite of the recession on the horizon, 26 gaming executives polled by the AGA, an overwhelming 92% expect conditions in the industry to keep improving over the next two quarters. This even though 68% of those polled already described the current situation as “good”. Additionally, 76% of those polled believe wages and benefits will continue to rise. The pace of hiring is still sluggish in the wake of the pandemic though.
“Our industry remains cautiously optimistic—and has weathered this volatile economy— because of resilient consumer demand,” said AGA President and CEO Bill Miller. “Looking ahead, future consumer confidence and spending remain an outstanding question for our continued growth.”
That is not to say there are not concerns about the economic future for gambling. Of those polled, 65% said supply chain issues are still impacting business, while 62% cited interest rates as a concern. The labor shortage was another oft-cited problem, but again, could help push up wages and benefits like the same executives predict.