The American Gaming Association (AGA), an industry trade group, surveyed gaming executives and found that the majority were unsure about the future of the sector’s economic prospects.
In spite of this uncertain view on the economic future, 60 percent of those executives interviewed rated current business conditions highly satisfactory, while 35 percent deemed them good. Comparing this to expectations for future performance, only 20% expect conditions will improve while 64% say that it would remain the same.
Bill Miller, AGA’s President and CEO said that “Gaming has maintained its record-breaking momentum into 2023.” While projections for a slowing economy in America are dampening gaming expectations over the next few years, the industry remains well-positioned to ride out any headwinds.
The AGA’s Industry Outlook, presented in partnership with Fitch Ratings, provides an overview of economic trends for the future of the gaming industry, based on key indicators such as executive sentiment, plans to visit casinos, revenue generated by gambling and other economic signals.
Caution is the key to growth
AGA stated that the survey results of gaming executives showed “cautious attitude for growth”. Most executives believe that revenue growth, new hiring and the activity of customers will decrease rather than increase over the next six months.
Executives have expressed concern about the challenges of a highly competitive market for talent in gaming, including the competition to retain current employees.
Many executives have expressed optimism in certain sectors of the industry. The majority of operators anticipate that capital investments and the number of gaming machines in operation will increase within three to six months.
The outlook for the gaming industry was particularly positive, with 88% executives predicting that sales of replacement units would rise, and 63% also stating that new or expansion units would be sold more in the future. Gaming manufacturers did not expect the sales pace to slow down.
As for macro-level risks, 38% of gambling executives cited economic uncertainty and 69% cited the impact of inflation and interest rates. The industry’s top concerns about supply chain impacts have been replaced by 31% of the executives that said geopolitical risks are a danger.
In recent months there has also been a decrease in the concern about credit availability. The percentage of senior executives that view it as difficult is now equal to the 20% who see it as being easy.
