US Gaming Revenue Falls In November
After six months of continuous growth, gambling revenue fell close to 15% in the month of November. With sports betting growing legally across the United States, what’s causing the decline? The report comes fresh from the American Gaming Association’s Commercial Revenue Tracker, which provides an overview and analysis of gambling trends and revenue on a monthly basis in the United States, provided several months after the fact.
Until Now, Gambling In The US Coming Back
The pandemic has seen significant rises and falls in the American gambling market. For several months after March 2020, the gambling industry was hard-hit across sectors, as retail gambling locations were forced to close indefinitely and traditional sports betting was off the table, as IRL sporting matches around the world came to a halt.
As has been seen across sectors of the economy, gambling companies already with robust online options were able to stave off some of the financial hurt incurred by land-based location closures, game cancellations, and lockdowns. As 2020 went on, too, states across the US began legalizing sports betting, including online, in overwhelming numbers.
Even In April, Industry Started To Come Back
Still, as early as April 2020, when the global pandemic was in its earliest days and most states in the United States remained under some form of strict lockdown, gambling revenue was on the road to recovery in the country. In states like Pennsylvania and New Jersey, online gambling rocketed upwards.
In April 2020, for example, New Jersey saw a jaw-dropping increase in revenue for iGaming. Between March 2020 and April 2020, online poker in New Jersey grew 209%, with a revenue total of $5.1 million. Overall iGaming in the state increased 19% month-over-month, with total revenue of $79.9 million in April.
In Pennsylvania, iGaming revenue in the state grew 73% from where it had been in March 2020. In fact, the pandemic perhaps exacerbated a preexisting, non-pandemic-related growth in online gambling in the state, as March 2020 already demonstrated an increase in iGaming revenue 24.5% greater than what it had been during February of the same year.
October Saw Record High Revenue For Sports Betting
In late December, the AGA released revenue numbers for American gambling during the month of October in 2020, which demonstrated that the upward trend in gambling nationally was continuing into the fall. In 15 out of 17 states with legal sportsbooks, October saw record highs in sports betting, with more money wagered than ever before.
Then, In November: A Plummet
After six months of essentially unfettered growth in the American gambling market, November 2020 saw a surprising — and not-insignificant — decline in gambling revenue for the United States. For the month of November 2020, the national gambling industry reported a cumulative revenue of $2.92 billion.
2020: A Year Of Recovery, Not Growth
This number demonstrates a loss of 14.8% from October 2020. What is notable here is that the gambling revenue month-to-month in the United States during 2020 generally remained lower than what it had been during 2019, before the pandemic, though some sectors like sports betting and online gambling demonstrated growth, while retail gambling declined.
What Caused The Losses In November 2020?
According to the American Gaming Association’s report, the losses for the month of November 2020 can be attributed to the surge in COVID-19 infections nationally, which have prompted states around the country to reintroduce strict lockdown or curfew measures, which impact already-hard-hit retail gambling spots.
Fall 2020: COVID-19 In The US Reaches Record Highs
By the end of November, 2020, the United States had recorded 4 million confirmed cases of COVID-19 during a four week period. This was a dramatic increase from October, when the country recorded 1.9 million confirmed cases of COVID-19. The surge in cases is likely attributed to holiday gatherings or the new strain of COVID-19, which is more infectious.
In Response To Surge: Lockdowns Reinstated
Since the fall, states around the United States have adopted the unpopular approach of reintroducing lockdown measures. By late November, states including Michigan, New York, New Mexico, Pennsylvania, Illinois, and Nevada had implemented additional COVID-19 safety rules, affecting retail gambling revenue.
According to the AGA’s report, once casinos in Detroit were forced to close on November 18, gambling revenue in the state fell 50.3% from what it had been in October 2020. Philadelphia was hard-hit by the forced closure of Rivers Casino Philadelphia on November 20, which alone caused a contraction of 10.9% for gambling revenue for the month.
AGA’s Three Main Factors
In the report for November 2020 revenue, the American Gaming Association ultimately pointed to three factors it saw as central to the decline in gambling revenue for November 2020. This included COVID-19-related lockdowns, as well as the fact that November simply had fewer weekends than other months.
Finally, the AGA pointed to a reduction in discretionary spending during the month of 2020. This means that the report found that consumers in the US began spending less money on non-essential goods during the month of November, which would likely include gambling both online and in person, particularly if that involves travel.