Like any other sector of economic activity, the gambling industry does not exist in a vacuum. To function, it must interact with dozens of other services and industries; gaming companies hire and train employees, invest in infrastructure and social responsibility projects. But what happens to the industries and business niches that come with gambling?
What are the associated niches?
In the course of formation, any sector of the economy carries out an active commercial activity. New economic zones develop particularly actively after their legalization, and the gaming industry is no exception. In addition to the direct royalties that the organizers of legal games of chance use to finance the state budget, they also generate profits in other sectors of the economy by purchasing goods and services, renting premises and renting premises. resorting to other means of production. They thus contribute to the development of different economic sectors.
Here are some of the niches most affected by gambling organizers today:
Tip – The legislative regulation of gambling is quite strict, so it is not easy to go through the procedures for obtaining licenses and starting a business. This requires lawyers and business consultants, especially if a foreign company is considering obtaining a license with no experience in a particular jurisdiction;
Staff recruitment and training – The gambling market is fairly new, so researching and training staff requires a lot of time and resources. Legal organizers are actively investing in HR and recruiting, which not only helps increase the number of formal jobs, but also provides an opportunity to earn money for companies specializing in finding and hiring staff. ;
Rental and Repair of Premises – Casinos, slot machines, bookmakers invest tens of millions of dollars in renting and renovating hotel rooms to bring them into compliance with licensing requirements. Some organizers are even building new four and five star hotels to open gaming establishments;
Purchase, certification, maintenance of gaming equipment – For example, a modern slot machine costs an average of $ 15,000 to $ 20,000. There are also the costs for its maintenance, software support, etc.
Investment in IT – For online gaming operators, the main products are their online platforms and gaming applications, the development, improvement and maintenance of which require constant investment. Some companies rely on their own IT departments, while others use outsourced developers. However, in both cases, they are investing tens of millions of dollars in IT. This is especially true for the first class casinos featured in Casinochance.ca odds;
Marketing, Advertising and Public Relations – Legal gambling activities are designed to convey positive emotions. And one of the most effective tools for communicating their own mission and attracting clients for legal organizers is advertising and public relations.
Nowadays, the gaming industry is one of the biggest advertisers in the online and offline segments, along with FMCG products and retail technology. In addition, socially responsible gambling advertising must adhere to a number of rules, which is also associated with economic consequences for the gambling industry.
Sponsorship Agreements – Most legal gambling organizers, especially in the betting industry, sponsor sports events and teams;
Funding of Social Responsibility and Charity Projects – Legal gambling organizers actively invest in social responsibility projects and donate to charity. This helps to better convey the real value of the gaming business to society and to create a positive social effect outside the gaming sphere.
This is not a complete list of areas in which the gambling industry generates profit directly or indirectly. There is also the purchase of furniture, uniforms for the employees, the cost of maintaining the infrastructure of the gaming facilities, the rental of offices, transport services, etc. There are dozens of other areas where the gaming business acts as a customer and pays money. Obviously, gambling occupies its place in the ecosystem of the global economy and contributes to its scaling up.
What happens in most gambling towns?
Analysts estimate global gaming revenue at $ 130 billion per year. The biggest casinos in Las Vegas are capable of winning up to $ 14 billion in 2 months. At the same time, these organizations offer many high paying jobs. And this is how gambling affects the economies of the most famous cities where this type of activity is fully legalized.
# 1 – Las Vegas
Las Vegas is all about gambling. It is one of the most famous cities in the world that tourists from all over the world head to to play their favorite casino games. Thus, more than 42 million tourists visit the city each year. Each of them spends an average of $ 540 on gambling and $ 400 on other non-casino related needs. In general, the city spends around $ 23.68 billion per year on casinos, and the total tourist spending in the city reaches $ 40 billion.
The average casino employee salary exceeds $ 50,000 per year, and there are around 160,000 in the city. LA casinos and hotels pay around $ 1 billion in taxes per year. Casino winnings are also taxed.
# 2 – Macau
Macau is considered to be the biggest gaming center in the world. It is now the only city in China where you can legally gamble. Macau has become a real tourist destination mainly for locals. Tourism accounts for about 45% of the city’s GDP, and the gaming industry’s revenue is $ 39.6 billion. This company employs around 65% of the city’s working-age population. Casinos generate about 78% of all local budget revenue, or $ 14.3 billion annually.
# 3 – Monaco
The city-state of Monaco is one of the smallest in Europe, but it is famous for its chic casinos. Interestingly, gambling is prohibited for those who reside in Monaco, but this rule does not apply to foreign tourists.
Each year, four Monegasque casinos earn around 210 million euros, employing more than 1,300 city residents. The share of the gambling industry in the country’s economy is rather small (just over 7% of GDP), but casinos attract tourists from all over the world. Among the visitors to the casino are the wealthiest people, sportsmen and other celebrities. Monaco is a territory with reduced taxation, so only value added tax is paid there.
This article does not necessarily reflect the views of the editors or management of EconoTimes.