Baltimore is a troubled city, as you know from The Wire. Like many troubled cities, Baltimore has turned to casino gambling as its solution. On August 26, a new Caesar’s casino will open on the site of an old chemical factory, a little more than 2 miles from the famous Inner Harbor and Camden Yards baseball stadium. Yet there’s already reason to expect the casino to disappoint everyone involved: the city looking for tax revenues, the workers hoping for jobs, the investors expecting hefty returns.
Outside of Las Vegas—now home to only 20 percent of the nation’s casino industry—casino gambling has evolved into a downscale business. Affluent and educated people visit casinos less often than poorer people do for the same reasons that they smoke less and drink less and weigh less.
Unfortunately for the casino industry’s growth hopes, downscale America has less money to spend today than it did before 2007. Nor is downscale America sharing much in the post-2009 recovery. From a news report on the troubles of a recently opened Ohio casino:
Ameet Patel, general manager of the property, says the softness in casino revenue that he and other operators have seen has been driven by a key demographic: women older than 50 who used to bet $50 to $75 per visit. The weak recovery has squeezed their gambling budgets, and their trips to casinos are fewer, he says.
What’s true in Ohio applies nationwide. Casino revenues had still not recovered their 2007 peaks as of the spring of 2014, when again they went into reverse in most jurisdictions. Moody’s now projects that casino revenues will drop through the rest of 2014 and all of 2015, slicing industry earnings by as much as 7.5 percent.