INSIDE ASIAN GAMING | Dec 2007 4 E D I T O R I A L Editor and Publisher Kareem Jalal Director João Costeira Varela Business Development Manager Matt Phillips Operations Manager José Abecasis Contributors Mike Grimes, Octo Chang, Richard Marcus, Photography Ike Graphic Designer Brenda Chao Inside Asian Gaming is published by Must Read Publications Ltd Suite 1907, AIA Tower, 215A-301 Av. Comercial de Macau - Macau Tel: (853) 6646 0795 For subscription enquiries, please email
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[email protected] or call: (853) 6646 0795 www.asgam.com Printed by Icicle Print Management (Macau) Ltd Tel: (853) 2871 2818 Fax: (853) 2871 2898 www.icicleprint.com M acau’s casino boom has led to a raft of inequalities. It has raised wages and rents, leaving small- and medium-sized enterprises (SMEs) struggling to compete for re- sources with the powerful casinos. Macau is now essentially at full employment, with a mere 9,600 workers—equivalent to 3% of the labour force—currently without jobs. Most of the remaining unemployed are so lacking in skills as to be virtually unemployable. Given the acute labour shortage, the government ban on casinos employing non-residents as dealers has led to dealer salaries skyrocketing. A teenage high school dropout can earn a starting salary of MOP15,000 (US$1,875) as a dealer, while a long-suffering middle-aged factory worker can only expect a median salary of less than MOP4,500. As a response to the social problems caused by the casino boom, Macau Chief Execu- tive Edmund Ho’s November policy address included a proposal to raise the qualification age for entry to Macau casinos from 18 to 21. The move could go ahead as early as the summer of 2008. Even before the new policy gets on the statute books, however, it has been criticised as window dressing and a political gesture of little practical benefit. Some have even called for the entry age to be raised to 25, to create an incentive for Macau’s school leavers to go on to university instead of grabbing well-paid jobs with poor long-term prospects. When the city’s first gaming law took effect in the 1960s, the minimum age limit for entry was 25. Unless locals improve their skills and qualifications, the top jobs in Macau’s new gaming and tourism industry will continue to go to western expatriates, Hong Kong residents or overseas Chinese. Stanley Ho, Macau’s former monopoly casino operator, has publicly supported raising the qualification age, observing that some young employees are unable to add up properly. Triple relief Raising the age to 21 is in theory designed to relieve three social policy headaches. The first––and from the viewpoint of the small business community and many long-term Macau residents most pressing––is the shortage of young people to work in shops, restau- rants and other modest scale enterprises. The lack of young local workers, aggravated by reduced quotas for imported workers, has, as one local commentator put it, “sucked the oxygen out of Macau’s SMEs.” The second headache the policy is supposed to address is the high dropout rate from local universities. Academics complain that many school leavers with confirmed offers of places aren’t even bothering to take them up, preferring to take their chances in Macau’s heated job market. Thirdly, raising the age limit is meant to head off criticism that Macau’s young are coming too much under the thrall of a ‘get rich quick’ culture. A recent study by the University of Macau suggested primary school children were starting to engage in cash betting on play- ground games among their peer group. If the policy is seriously meant to help SMEs, however, it has two major flaws. According to the government Statistics and Census Service, between the third quarter of 2006 and the third quarter of 2007, a mere 4,600 first time job seekers came onto the market– –only enough people to work a single shift at The Venetian Macao. The government has indicated that the under-21s already employed in casinos will be al- lowed to stay in their posts, meaning the net addition of under 21s to the job market will only kick in from next summer at the earliest. That probably means a potential net gain of less than 5,000 workers a year to the SME labour pool for the next three years at a time when the size of the adult population is growing over 6% a year and demand for non-casino services is soaring. Also, the more the initiative succeeds in encouraging school leavers to pursue tertiary education, the less the gain to the SME labour pool. One pill cannot relieve three headaches. Raising the qualification age to 21 would appear most likely to relieve the second headache, encouraging Macau’s youth to take up their uni- versity seats and improve their skills. That would unequivocally benefit the city in the long-run. The cure to the first headache comes from the recognition that its cause is closed borders and impediments to the free movement of labour into Macau, rather than an unsustain- able pace of casino development. Part of that solution will be a headache in itself for the government, as it goes up against the city’s increasingly militant labour groups to let a much needed lifeline of imported workers into the city. What happens in Macau’s primary school playgrounds, meanwhile, is on the heads of the parents. Kareem Jalal We crave your feedback. Please send your comments to
[email protected] One Pill Doesn’t Cure All