At-Risk Gambling and Philadelphia Area Casinos

The American Gaming Association frequently claims that the overwhelming majority of gamblers are “recreational gamblers” who gamble without harm or risk of harm.[1] We know that this claim is not just misleading, but irresponsible.  Research on risk of gambling addiction and the boasting by casino executives gives us an idea of just how irresponsible.

General manager of SugarHouse casino in Philadelphia, PA Wendy Hamilton, for example, reported a “large number” of her casino’s customers came “three, four, five times a week.”[2]  Executives from three other Philadelphia area casinos reported that the “average” customer, or “most” customers came 3-5 times a week.[3]

Yet gambling frequency, like frequent alcohol consumption or frequent use of drugs, has been found to be a risk factor for gambling addiction.  Data from the National Comorbidity Replication Survey of 2001-2003 showed that “[e]very instance of weekly gambling (52 occasions of gambling in the past year) increases pathological symptoms by 26%.”[4] That makes it highly unlikely a weekly gambler does not suffer from some level of gambling addiction.

To look at this another way, a 2002 national survey of Canadians set a tentative cut-off point for low-risk gambling at 2-3 times a month.[5] What casino executives are telling us is that, at 3-5 times a week, “a large number,” the “average customer,” or “most” customers at these casinos gamble at levels well beyond the cut-off point of 2-3 times a month.

Estimates for risk based on gambling expenditures tell the same story.  The same U.S. national survey found that “[e]very US$100 increase in the average win/loss is associated with a 65% increase in number of pathological gambling symptoms.”[6] Dave Jonas, president of Parx Casino stated that “we have customers who give us $25-$35 five times a week.”[7]  Using this as a rough estimate, a gambler who visits 5 times a week and loses an average $35 a visit, loses $8,400 a year.  Even if a gambler visits 3 times a week and loses an average of $25 per visit, that’s an annual loss of $3,600 a year.[8]

To put this level of gambling in perspective, put aside the facts and figures for a moment and consider the common claim that casinos merely provide “entertainment,” just like, say, a movie theater.  So imagine a friend of yours tells you that they just went to see a movie - three times in a row.  You might think that this must be the greatest movie of all time.  Yet, what if they told you that they went back the next day and did it again.  Seven hours, thirty-six dollars, the same movie three times in a row.  Then they did it the next day.  Then they tell you they have done this 3-5 times a week all year.  At what point might you become concerned about your friend?

There are no cut-off points or risk levels established for movie going; but then, nobody goes to the movies that much unless they work there.  At Philadelphia area casinos, “most” customers visit that often.

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FOOTNOTES

[1]  See, for example the American Gaming Association fact sheet, and their Frequently Asked Questions page.

[2]  Monica Yant Kinney, Another Philadelphia casino? It’s a game for suckers; Philadelphia Inquirer; May 6, 2012

[3] Ibid

[4] R. C. Kessler, I. Hwang1, R. LaBrie, M. Petukhova1, N. A. Sampson, K. C. Winters; and H. J. Shaffer; DSM-IV pathological gambling in the National Comorbidity Survey Replication; Psychological Medicine (2008), 38, 1351–1360

[5] Currie S. R., Hodgins D. C., Wang J., el-Guebaly N., Wynne; H., Chen S.; Risk of harm among gamblers in the general population as a function of level of participation in gambling activities. Addiction 2006; 101: 570–80.

Based on this frequency cut-off, the study estimates that just over 32% of Canadian gamblers fell outside the range of “low-risk” or “recreational gambling.”

[6]  Kessler et al. 2008

[7]  Monica Yant Kinney; The lifeblood of Parx casino in Bucks is low-roller locals; Philadelphia Inquirer; March 7, 2010.

[8]   It possible that estimates based on expenditure cut-off points would yield lower figures for at-risk gambling.  Curie et al., for example, found that “The proportion of the Canadian population who gamble exceeding these cut-offs were 32.4% (>2 to 3 times per month), 11.1 % (>$501-$1000CAN per year), and 11.4% (>1% gross income), respectively.”

Applying the financial expenditure cut-off point in the context of Philadelphia area casinos, though, may not differ greatly from the estimates of at-risk gamblers based on frequency.

Although we do not have complete data on gambler expenditures, let alone gambler’s household incomes, but we can make some rough estimates.  Dave Jonas, president of Parx Casino stated that “we have customers who give us $25-$35 five times a week.” (Kinney, 2010).  Based on these numbers, using the cut-points of 5% personal income and 9% household income for “low-risk” gambling, we can state the following: 

On the low end of expenditure, a gambler who visits 3 times a week, losing an average of $25 a visit, loses $3,600 a year. At the upper end of the scale, a gambler who visits 5 times a year, and loses an average $35 a visit, loses $8,400 a year.

The Canadian study put cut-off points for low-risk gambling at a yearly gambling expenditure of less than $1,000 Canadian, or $630 U.S. (In 2002, the exchange rate for U.S. Dollars on November 15th was $1 CAN = 0.6310 US).  Again, placing many, if not “most” customers at high risk for gambling addiciton.

A second study, using data from a national survey in Brazil, (Hermano Tavares; Elizabeth Carneiro; Marcos Sanches; Ilana Pinsky; Raul Caetano; Marcos Zaleski; Ronaldo Laranjeira; Gambling in Brazil: Lifetime prevalences and socio-demographic correlates in Psychiatry Research, 2010, Vol. 180, No. 1, pp. 35-41) also suggests cut-off points for low-risk gambling based on expenditure levels.  That study found that those who spent more then 9% of personal income, or more than 5% of household income, incurred rapidly escalating risk for gambling addiction.

Using these cut-off points, at a yearly expenditure of $3,600, a gambler is “at-risk,” or outside the boundaries “recreational gambling if personal income is less than $50,000 a year, or if household income is under $75,000 a year.

According to the United States Census Bureau’s American Community Survey (ACS), the median household income in Philadelphia in 2011 was $34,207.

At a yearly expenditure of $8,400 a year, a gambler is “at-risk,” if either personal or household income is less than $100,000 a year.

In 2011, according to the ACS, a little less than 12% of households in Philadelphia had income over $100,000.