The poker machine industry has been shut down in Tasmania since the 24th of March. The industry is set to re-open on Friday the 26th of June.
Re-opening these venues will provide immediate employment to staff previously stood down. However, our research shows that, in broader terms, poker machines (“pokies”, “electronic gaming machines” or “EGMs”) are a drain on the state economy and on jobs.
Tasmania has been hard hit by COVID-19, suffering more job losses per capita than any other state. It can therefore be assumed that Tasmanians are also receiving a high level of JobSeeker and JobKeeper support per capita. These payments are designed to assist the unemployed and provide stimulus into a supressed economy. Poker machines are highly profitable for owners, but low return for job creation.
Our analysis shows that, since the lockdown began in late March, around $42 million that would normally be spent on the pokies has not been spent on the pokies.
$42 million spent in Tasmania could create:
- 398 jobs in Food and Accommodation; or
- 236 jobs in Arts and Recreation; or
- 427 jobs in Health Care and Social Services; or
- 125 Retail Trade jobs
Estimates of jobs directly related to pokies vary widely, but businesses that include gaming activities themselves estimate that only 19% of their employees are working directly in gambling roles.
The state budget has also been hit, with the Premier acknowledging the state will go into a $700 million deficit. Our research finds that under most models, the cost of EGM-related problem gambling (up to $184 million in 2011 dollars) far exceeds revenue from EGM-related gambling taxes and fees ($53.4 million in 2016). Given the current position of the state’s budget, and the impact (social and economic) on the community from COVID-19, re-opening the pokies represents a net financial burden to the state.