Gaming CEOs are confident in the future of the industry, expecting positive conditions to continue to improve in 2022, according to the American Gaming Association (AGA).
AGA’s newly launched Gaming CEO Outlook, published on Tuesday, shows confidence in expanded industry growth, with almost half of AGA-member CEOs expecting improved business conditions.
As the industry comes back from one of its most challenging periods ever, marked by pandemic-related closures and restrictions, now participating CEOs are anticipating increases in new hiring (71%), wage growth (63%), and capital investment (39%).
"AGA's inaugural Gaming CEO Outlook reflects the strength of our recovery and consumer demand for our world-class entertainment offerings," said Bill Miller, AGA president and CEO.
Despite the positive outlook, certain challenges remain. More than two-thirds (71%) of CEO respondents cited supply chain issues as a factor limiting operations. Labor force shortages (63%), consumer health concerns (46%), and lagging meetings and events demand (38%) are also cited as impeding short-term growth.
The Gaming CEO Outlook was prepared for the AGA by Oxford Economics. It provides a snapshot of the current and future economic health of the industry based on key indicators such as gaming revenue, executive sentiment and employment. Results are informed by a survey of AGA member CEOs and executives from different sectors of the industry: equipment suppliers, casino operators, and sportsbooks.
The report features two indices: the Current Conditions Index and the Future Conditions Index.
The CCI of 115.1 reflects “exceptionally strong growth” in gaming revenue, employment, and employee wages and salaries over the past quarter. It represents one of the fastest periods of growth in the industry over the past 20 years, AGA says. All CEO panel participants assessed the current gaming business climate as “good” (54%) or “satisfactory (46%).
The FCI provides an indicator of changes in industry conditions, reporting a positive result at 102.7. Nearly half of gaming executives expect future business conditions to further improve from today’s already strong climate. Only 9% expect conditions to deteriorate over the next six months.
Further highlights of the Gaming CEO Outlook find that half of gaming operators plan to increase hotel and food and beverage amenities, while 43% plan to increase capital investments in gaming machines.
Optimism is also present among gaming suppliers. Over the next six months, 75% expect sales of gaming units for replacement use to increase, and 63% expect sales of new units to improve.
The gaming industry’s recovery is well underway, says AGA. A record-breaking second quarter and the reigning optimism among executives point towards a strong end of the year and a robust start to 2022. The return of G2E as an in-person event, following a one-year hiatus, also shows things are only getting better.
"Our industry's return to Las Vegas for G2E is a milestone in our recovery," Miller said. "G2E 2021 is providing an essential platform for gaming leaders to highlight their latest products, conduct business, and drive our recovery forward."