Just before the start of the 2008 World Series of Poker, I wrote an article addressing fears that the struggling US economy might impact upon the turnout for the WSOP. Thankfully those fears seem to have been misplaced. Overall attendance was up 8% and main event numbers saw a moderate increase of about 500. However, as the US economy lumbers slowly towards recession, the larger issue is no less worrying – financial numbers for Las Vegas are in free-fall.
If there’s one thing that can spark an upturn in fortunes for Vegas’ monetary woes then its the World Series. Harrah’s will certainly enjoy the increase in profits it’s sure to experience after collecting a total of $13,000,000 from tournament buy-ins. An increase in total buy-ins of $20,000,000 is sure to put a smile on Harrah’s collective face.
However, a quick glance at the recently released financial numbers from May might wipe that smile away as quickly as it arrived. The Nevada Gaming Control Board’s Monthy Win and Percentage Fee Tax Collection report for May 2008 shows that gambling revenues are down 15.17%. A worrying trend that appears to be building steam, as profits slip further and further away from last year’s figures. The Strip, the figurehead of the Las Vegas casino fraternity, saw an even greater decrease of gaming revenues down 16.44%.
What makes this all the more troublesome is the assumed resilience of gambling to economic recession. In times gone by, thrill seekers continued to pour into the casino floors no matter their money woes, now they seem to be staying away. This is in no small part due to the diversification that has taken place in Vegas over the last few years. Moving more towards leisure sectors, the big guns have hoped to attract in more of the lucrative tourist market. While this might be a great move in a more positive climate, when things aren’t going so well this sector is one of the hardest hit. With Americans everywhere feeling the pinch, luxury holidays are put on the back-burner in favor of storing up the pennies.
There’s no doubt that the WSOP will have had a favorable impact on both the gambling and leisure sectors of the Vegas economy, with the city flush with gamblers as well as rail-birds. However we will not know the true extent of this assistance until the June and July number are released. Whatever the result, all signs seem to indicate harder times to come for both Las Vegas and America as a whole.