# 9.1: In the Beginning...


## The Gaming Industry

Welcome to the gaming/entertainment casinos chapter. To this point, you should have an understanding of the operational functions that are central to most hospitality operations such as rooms, housekeeping, and food & beverage (F&B). Gaming entertainment properties often, but not always, include these functions in addition to having a casino. With the inclusion of gaming activities (i.e. slots and table games), additional functions become required. Because of this, managing a gambling operation requires certain job skills and specializations that fall outside the scope of general hospitality management. In this chapter, you will learn how the modern gambling industry came to be, how the industry is globalizing, and how this evolution has created new kinds of career paths for you to consider as a hospitality student.

In 2019, the gaming industry generated revenue of $130 billion U.S. (O’Connor, 2020). To put that into perspective, the entertainment industry exceeded$100 billion in annual revenue for the first time in 2019 (Rubin, 2020). A large share of gambling revenue is driven by major corporations you may recognize by name including MGM, Caesars Entertainment, Las Vegas Sands, and Wynn Resorts. Internationally, gaming corporations include Melco Crown, Genting, SJM, and Galaxy. In the U.S. alone, the gaming industry employs over 361,000 employees (American Gaming Association, 2020). Communities benefit from casino resorts in different ways from hospitality operations that are absent of gambling. While tourism is a major driver for the hospitality industry, jurisdictions that allow for gambling also gain from gambling. In 2019, gambling taxes surpassed $10 billion in the U.S (American Gaming Association, 2020). In this chapter, we will start by reviewing how the gaming industry came to be by looking at its origins. Different pathways to success within the gaming industry will also be reviewed. We will also highlight efforts by the industry to develop a more sustainable and inclusive work environment. Photo by Kay on Unsplash ## Gaming Today Gambling today is far different from what gambling looked like in ancient times. There is evidence to suggest that gambling existed as far back as the Stone Age. The Greeks gambled with “astragali”, which were created out of sheep bones. The expression “roll the bones” to express the rolling of dice can be traced to these origins. The first modern casino was developed in Venice in 1638. Monte Carlo (Monaco) represented the peak of casino development, which grew throughout Europe in the 18th and 19th centuries (Lucas & Kilby, 2012). To understand today’s gambling industry is to also understand the American experiment of Prohibition, occurring in the 1920s. Originally motivated by anti-corruption and moral activism, the banning of alcohol created unintended drawbacks by pushing bootlegging into the underground. Within the shadows, black markets expanded and crime networks became more sophisticated. Mob figures became interwoven into local politics as well as the social fabric of America. Even the Kefauver congressional hearings—a televised event in the early 1950s where lawmakers and mob figures squared off—did little to combat the spread of organized crime. It was collective ignorance that later led Americans to be disgusted with themselves. The hearings, which occurred during the 1950s, marked an important point in history as it forced society to confront and resolve sticky issues related to gambling. In the decades since, new laws and regulations have emerged, which targeted organized crime and paved the way for legitimate casino business operations. Not until the 1980s, did American law enforcement and regulatory bodies develop to the point where they could effectively push unsavory figures out of the industry. As America was industrializing, economies in the West were looking for new ways to grow their economy. The gold rush from a century prior had run its course. Nevada decided for itself that it might be able to create economic activity in two ways. One way was to make marriage and divorce laws more flexible. Secondly, the State decided to legalize gambling—a recreational activity commonly associated with the West. Through the remainder of the 20th Century, Nevada, Las Vegas and Reno in particular, came to define what a commercialized gambling operation can look like to the rest of the world where gambling remains illegal. The gaming industry today is highly visible and dominated by publicly traded corporations with global reach. The industry is a far cry from an era when the boundaries between legitimate and illegal gaming operations were a bit hazy. Since the last half of the 20th century, gambling has legitimized itself as a global corporatized business (Bernhard, et al., 2008). Today, gambling in some shape or form is commonplace in the West. Key court rulings in the 1970s and 1980s also opened the door for Indian gaming operations, which by itself generates$32bn. Today, some form of gambling is legal in all but two states, Hawaii and Utah (Stutz, 2020). In 2014, it was estimated that about a third of the U.S. live within 25 miles of a casino (Schwarz, 2014).

Globally, there are more than 2,150 casinos. The development of commercialized gambling in Macau is also important. Adjacent to Hong Kong, which was colonized by the British, Macau was colonized by the Portuguese in the 16th century. It remained a territory of Portugal until the end of the 20th century. Today, Macau is a Special Administrative Region or SAR of China. However, gambling remains illegal in mainland China. What makes Macau so important on the global scale is that it substantially exceeds Las Vegas in the gambling revenue it generates. In 2016, Las Vegas generated $11.1bn (US) compared to Macau, which generated$28bn.

Singapore is also important in the history of the development of gaming entertainment casinos. This is because this small city-state in Southeast Asia is often associated with having strict laws and conservative social values. Gambling, with the stigma, that it can carry, made Singapore an unlikely candidate for casino development. Written into the law that allowed for the development of Integrated Resorts (IRs), is that the casino makes up only 12% of the entire property. What is important is that any operator integrates sufficient levels of non-gaming amenities including hotel, F&B, entertainment, shopping, and MICE (Meetings, Incentives, Conventions, and Exhibitions).

Photo by Kvnga on Unsplash

## Career Opportunities

The growth of the gaming industry has also expanded the career options available for many looking to enter the hospitality workforce. Whether it’s working as a pit boss, in cage operations, or a casino marketing executive, there are many distinct career opportunities that may not otherwise be available in non-gaming hospitality organizations.

Casinos come in all shapes and sizes, and they generally fall along a spectrum between repeater-market or ‘locals’ casino and integrated resorts (Lucas & Kilby, 2012). Walk into a modern gaming entertainment casino and you would find that it shares many of the same things you would find in a normal hotel resort. Although there are gaming-only facilities like racetracks, bingo halls, and poker rooms, most gaming properties include a hotel and F&B operations. Additionally, larger integrated resorts include MICE and entertainment facilities. Of course, the most noticeable difference between gaming and non-gaming properties is the presence of a casino.

At first glance, it may be concluded that a casino floor simply requires dealers, pit bosses, and a cashier area where casino chips can be cashed in. However, due to the complex regulatory nature of the gaming industry, there are many jobs invisible to the customer that are required to make a casino/gaming entertainment property function. Although there is some variation, most casino floors will consist of a slot area, a table games area, and a race & sportsbook (R&S) area. Additionally, casinos have a marketing department where relationships are developed between the casino and repeat customers. In this section, we’ll take a look at three specific examples of leaders in these areas, and their pathways to success.

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