Inside Asian Gaming

inside asian gaming August 2014 12 “As the majority of casino customers are from mainland China, I don’t believe it will be a problem for casinos to use middle-aged dealers because many of them speak the same language as the customers—Mandarin.” The Macau Gaming Industry Workers Association, an affiliate of the Federation of Trade Unions, has been offering vocational training courses for prospective dealers since 2003, teaching basic baccarat knowledge and language skills. “Many of those enrolling in our courses now are female, middle-aged, not well-educated, with low monthly income, and some are recent immigrants,” says the association’s vice president, Leong Sun Iok. “They want to work as dealers to improve their livelihood.” And the courses “are always full,” he says. “Over 80% of our students successfully secure dealer jobs. Demand for them is high, especially in light of the current tight labor market.” About one-fifth of employees in the gaming sector, some 21.2%, were aged between 45 and 54 as of last year, up from 18% in 2004. Across all sectors of the economy, workers between 45 and 54 accounted for 23.3% of the total, down from 25.6% in 2004. US-based brokerage Telsey Advisory Group believes Macau’s cash- rich gaming operators are capable of recruiting all the workers they need. “Today, while labor is expensive, there does not appear to be any lack of supply,” writes analyst Christopher Jones. “Looking further out, casino-based labor is not really a casino problem as operators have the margin and capacity to pay up for the local labor required.” Wynn Macau announced in March that it will issue 1,000 shares of its Hong Kong-listed stock to each of its 7,500 employees. In July, Melco Crown Entertainment unveiled a bonus scheme for its staff that includes a one-off handout equivalent to six months’ salary. Sands China revealed in the same week that it will add a second month’s pay to its annual bonus package. The average salary in the gaming sector stood at MOP19,120 (US$2,390) at the end of 2013. Mr Leong of the Macau Gaming Industry Workers Association believes it will soon rise above MOP20,000, with operators offering even more incentives to attract and retain workers. But this will not come without an impact on the bottom line. Mr Jones cautions that an expected 5-10% annual increase in labor costs could create “risk” for profits, pointing out that “labor is the third-greatest expense for operators after gaming taxes and junket commissions.” He says, “Macau will need a more progressive labor policy which allows for increases in foreign labor, though this seems almost entirely unlikely until the next chief executive election.” “Whether the Macau government will introduce any changes to its labor policies is still debatable, but it will not venture anything this year, which sees the election of the chief executive and the 15th anniversary of Macau’s return to China, as Beijing emphasizes prosperity and stability,” says Zeng Zhonglu, a professor at the Gaming Teaching and Research Centre of Macao Polytechnic Institute. Political activism has flared up in recent months—some refer to it as Macau’s political awakening—after the city witnessed on 25th May the largest protest since the 1999 handover, with residents taking to the streets to voice their opposition to a lavish perks bill for outgoing government officials. Meanwhile, although working as a dealer is helping Ah Mei put her son through university, she clearly does not want him to follow in her footsteps after he graduates. “There is no way I’ll let him become a dealer, otherwise why would I be paying for him to go to university?” she says. “I would prefer he work in a bank or for the government.” “Today, while labor is expensive, there does not appear to be any lack of supply,” says Telsey Advisory Group’s Christopher Jones. “Looking further out, casino-based labor is not really a casino problem as operators have the margin and capacity to pay up for the local labor required.” Feature “The only solution to this problem is for the government to strictly fulfill its pledge of capping the growth of the number of tables.” Ieong Man Teng president, Forefront of Macau Gaming