Inside Asian Gaming

INSIDE ASIAN GAMING | August 2010 28 a policy of localisation of labour, known as ‘Emiratisation,’ for the past 12 years. The UEA’s Council of Ministers issued a directive as long ago as 1998 requiring all bankstoincreasetheirintakeofUAEnationals at the rate of 4%per year. In 2004, the cabinet issued another resolution approving a set of measures for boosting Emiratisation of jobs in the private commercial sector. Inside Asian Gaming understands from gaming industry sources that Macau, aside from reserving casino dealer jobs for permanent residents, also has a policy of incremental localisation for pit supervisor and pit manager jobs. Insiders say the crucial difference in Macau is that this objective has not been formalised and written down as a directive or government policy. As a result, casino operators can’t be sure that the policy is being instituted evenly across the local industry, nor can they be sure that their cooperation will pay the political dividends they might reasonably expect in terms of building goodwill with the locals and the government. Arguably, the advantage of the UAE approach to localisation is that it is transparent, managed incrementally and backed by policies to improve the take up of higher education and professional skills among locals. The latter element means that in the medium to long term, employers don’t suffer a fall in efficiency by taking on local people, because there’s a managed programme to improve and develop the skills of those local staff. A similar process of localisation will take time in Macau, and needs the help of strong and clear policies backed by a higher take up of further education to make it work effectively. Simply announcing overnight that one local should be hired for every outsider brought in, as happened recently with the construction industry in Macau, to create administrative and practical bottlenecks in the execution of two of the biggest gaming real estate projects in the territory. Those projects are the US$1.8 billion Galaxy Macau, the Cotai resort from Galaxy Entertainment Group, and the US$2.4 billion Cotai 5 and 6 from Sands China. The casino operators and their contractors and sub contractors will eventually jump through the necessary legal and commercial hoops and employ more locals.That maymean throwingmoremoney at the problem and raising construction sector wages to attract locals from other sectors. Something similar happened in the casino dealer segment at the time of the ‘Big Bang’ of new casino openings on the Macau isn’t going to help if the local people don’t have the necessary skills and perhaps even the motivation to do those jobs. According to the Macao Economic Bulletin for thefirst quarter of 2010published by the government, there were only 9,500 residents registered as unemployed in the territory. Sands China has said previously it needs 10,500 workers for its Cotai 5 and 6 project. It doesn’t need all of them all at once, but it needs them nonetheless across the life of the project, which could take up to three years to complete. The net result of the government’s one- for-one policy on construction workers seems to have been not to produce greater opportunity for the people of Macau, but Macau unemployed population (permanent residents) 2007 2008 2009 2009 2009 2009 2009 2010 Q1 Q2 Q3 Q4 Q1 (%) Unemployed population thousand 9.5 10.0 11.7 12.8 11.9 12.3 9.9 9.5 y on y % change -9.1 6.1 16.3 32.9 30.2 17.5 -10.3 -25.8 Age group (%) 16-24 28.9 27.9 27.6 28.8 27.8 30.0 22.7 23.5 25-34 16.4 13.6 14.1 15.2 11.9 16.4 12.2 12.5 35-44 19.0 20.8 17.4 17.8 19.4 15.9 16.3 18.7 45-54 25.7 29.1 28.9 28.0 27.1 28.3 33.2 31.9 55-64 10.0 8.5 12.0 10.2 13.8 9.4 15.6 13.4 ≥65 - - - - - - - - Source: Macao Economic Bulletin/DSEC Galaxy and Sands will overcome the labour headaches Macau Policy