Unnerving Forecast: Macau And Singapore Expect Staff Cuts

Article by : Eva Reed Aug 17, 2020

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It looks like the unfavorable situation caused by Covid-19 in the gaming markets of Macau and Singapore will get further worse. Currently, gambling establishments are making all the necessary efforts to minimize their monthly costs of running. At the same time, most of them are still idle. One of the most effective and frequently used strategies, in this case, is staff reduction; what’s more, some employees expect not only temporary leave, but a final dismissal.

However, the situation for local and foreign employees does not look the same at all. Singapore’s legislation is structured to protect the residents from the law’s point of view and, therefore, give them a priority. As a result, the owners of Singapore’s casinos have to make difficult decisions and lay off foreign employees more often than residents.

According to Macau’s Statistics Census Bureau, the total population during the pandemic has dropped to 685,400. Meanwhile, more than 10,000 people have moved to other administrative regions in the last quarter of the year. On the other hand, according to Lei Wai Nong, Secretary for Economy and Finance, such a decline in population is entirely consistent with the number of people who lost their jobs as a result of the closure of gambling establishments.

According to the Labor Affairs Bureau, the number of foreign employees who have already faced a wave of layoffs is nothing less than 3,000 people.

Singapore-based gaming staff witnessed an almost identical situation. According to Resorts World Sentosa (RWS) data, layoffs in the gambling and entertainment industries primarily affected foreign employees. Preliminary estimates show that the number of residents working in the field of gambling and entertainment increased to 75%. Around the same time, the corresponding indicator was 66% exactly a year ago. Thus, about 2,000 foreign employees have already lost their jobs and were forced to move from Singapore.

RWS also stated that operators still prefer to keep residents’ jobs despite the same assessment of foreign and domestic employees’ performance. The situation looks like a foreign employee should cut above the efficiency of a local one to retain the relevant position.

It goes without saying that local authorities can consider such a situation a reasonably well-done job of preserving working places for the locals. Nevertheless, the disappointing forecasts regarding the restart of the gambling business and the still valid travel restrictions, impose specific challenges on casinos to attract new visitors.

Therefore, most gambling establishments that plan to open their doors to visitors make very restrained statements regarding the possible losses due to the pandemic’s consequences. The real situation with the reduction of employees and the decrease in profitability for land-based casinos and hotels will most likely be known for sure already at the end of 2020. As a result, operators continue to develop plans to reduce monthly gambling and staff costs.

However, the decline in foreign workers is a direct indicator that the economy is going through hard times. Back in 2019, over 100,000 people visited Macau a day. The number of visitors has now decreased to a minimum. Moreover, the casino continues to operate in a restricted mode. The number of visitors in 2020 is likely to reduce by 92% compared to 2019. It seems that the situation is in a-mile-less-than-ideal, and casino operators should sit tight and wait for better times to come.

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