Macau Recovery Takes a Hit as Casinos Asked to Reduce Workforces by 90 Percent

Posted on: July 1, 2022, 07:17h. 

Last updated on: July 1, 2022, 12:34h.

Erik Gibbs Read More
Expertise: Asia Pacific Gaming, Gaming Business, Global Gaming.

Analysts with the Sanford C. Bernstein brokerage recently pointed to relaxed quarantine protocols in China as a good sign for Macau’s recovery. However, a request that casinos in the SAR reduce their workforces by up to 90% may have a different outcome.

Macau COVID-19
Macau residents line up to buy face masks at a pharmacy. A new COVID-19 wave could threaten casinos once again. (Image: Macau Photo Agency/Unsplash)

Because of increased COVID infections in the region, the Gaming Inspection and Coordination Bureau (DICJ) is requesting that Macau’s casino operators temporarily reduce the number of workers on the city’s gaming floors, according to reports from GGRAsia.

Cloee Chao, a local gaming labor activist, confirmed to GGRAsia that a few frontline casino workers received calls from their employers about the reductions. Those unidentified companies offered them incentives to avoid their workplaces between July 1 and July 8.

SJM Holdings Ltd also sent a memo to its employees offering a “special home-leave program.” Employees who volunteer to take seven paid or unpaid days of leave will receive one extra day of paid leave as a bonus.

The DICJ has not made an official announcement confirming the request.

COVID-19 Threat Rising in Macau

Macau continues to fight the worst COVID-19 pandemic since the vector began in early 2020.

The Macau government announced yesterday that it had abandoned plans for mandatory nucleic-acid test certificates. It planned to introduce the requirement today and it was to apply to casino staff, customers, and officials visiting casinos and gaming properties.

On June 19, Macau saw 31 new COVID-19 cases, which resulted in heightened concerns over a new outbreak. Macau health officials reported yesterday that there are now 570 positive cases. In addition, another 7,000 people are living in mandatory quarantine.

Macau began shutting down its commercial industry a week ago, although casinos remained open.

In neighboring Hong Kong, the problem is worse, with a daily average of 2,000 new cases.

Economics Worsen for Macau Jockey Club

Macau casinos suffered near-catastrophic results during the first wave of COVID-19. As a result, casinos shut down for months, greatly impacting revenue.

But the casinos aren’t alone in lost revenue. The economic situation at Macau Jockey Club continues its decline as well. Its losses for the entire year were MOP1.9 billion (US$240 million), according to its latest financial health report.

The Macau Horse Racing Company, the administrator of the Jockey Club, reported a loss in 2020 of MOP1.7 billion (US$212.5 million) against revenue of MOP47 million (US$5.8 million). However, things began to turn around this year when the company reported MOP10 million (US$1.23 million) in horse betting gaming revenues for the first quarter.

The Macau Jockey Club employs around 800 people and is one of the most prominent private employers in Macau. It was previously known as the Macau Trotting Club, but it was sold to a new owner in 1989 and became the Macau Jockey Club.