Atlantic City casino smoking ban could cost 2,500 jobs, lead to gaming and tax revenue decline

The introduction of a permanent smoking ban in Atlantic City casinos could cost up to 2,500 jobs and cause a decline in gaming and tax revenue for the state of New Jersey, according to a new analysis by independent research and professional services firm Spectrum Gaming Group.

The report, commissioned by the Casino Association of New Jersey (CANJ), which has long opposed the introduction of the proposed ban, shows Atlantic City would be at risk of seeing as much as a 10% reduction in workforce from the loss of between 1,000 and 2,500 jobs. Moreover, it could lead to as much as a 10.9% drop in revenue if the ban were enacted.

The CANJ has reiterated it does not consider this to be “the time for a smoking ban” as both the Garden State and the region are still recovering from the Covid-19 pandemic. Casino employment in Atlantic City is at a 20-year low, the association says, with less than 50% of the workforce from 2003 and down 22% since 2018.

The group also claims Atlantic City visitation is also at a 20-year low, with car traffic down 10% in the last 3 years and air traffic down 25%. Meanwhile, land-based gaming revenues have declined by nearly half since 2006, are down from 2019, and have yet to exceed pre-COVID levels, the trade association argues.

The Spectrum Gaming Group study also found the ban could lead to a drop of up to $93 million in non-gaming revenue, and a loss of between $17.2 million and $44 million for the state and Atlantic City in tax revenue."The Atlantic City casino industry is the economic backbone of South Jersey,” said Joe Lupo, president of the Casino Association of New Jersey. “A smoking ban would result in a decline in customers, which would cause job losses, a decline in gaming revenue, and a decline in tax revenue that benefits the state and local economy, as well as New Jersey seniors and persons with disabilities.”

According to Lupo, the report was commissioned “to ensure a complete understanding” of the ramifications a ban would have on the city and the region. “Adding a smoking ban could cause a devastating effect to the community and state,” the CANJ president warned.

Moreover, the CANJ claims that the smoking ban would not only have negative impacts on financial operations, tax revenue and employment, but would also place Atlantic City casinos “at a competitive disadvantage” with Pennsylvania, where gambling venues permit smoking.

According to the Spectrum report, an estimated 21% of Atlantic City visitors are smokers, a percentage that is about 8% higher than in the general population. Based on that, the effects of smoking bans in other jurisdictions and other factors, Spectrum reached its estimated economic impact.

"The casino industry has taken significant steps over the years to create a healthier environment for employees and patrons, including limiting smoking to just a fraction of the floorspace," the CANJ said. "We understand this is a difficult issue, but it is important that we create a welcoming and inclusive environment for all of our guests, which include smokers and non-smokers."

Atlantic City casinos currently permit smoking on 25% of the gaming floor, while neighboring Pennsylvania permits at 50%. New Jersey casinos further claim the industry has invested in state-of-the-art filtration systems that circulate fresh air since the Covid-19 pandemic began.

Casino workers in New Jersey have long pushed for a ban to be introduced, seeking to eliminate a loophole in the state’s current smoking law. Smoking within venues was banned as a Covid-19 transmission-prevention measure in 2020, but the ban expired in April 2021: casino employees have since tried to get it reinstituted. December saw Atlantic City casino employees marching on Trenton, urging legislators to move a bill. 

“They’re talking money over health,” Pete Naccarelli of group Casino Employees Against Smoking’s Effects (CEASE) told Forbes about the new report. “People are dying in the casinos, people are getting sick; long-term effects of secondhand smoke are well-documented, and it’s costing lives.”

There are currently two bills in the New Jersey legislature, one in the assembly and one in the senate, seeking to introduce the casino smoking ban. Gov. Phil Murphy said he would sign a bill on the matter should it land on his desk.