Do communities with casinos experience unique or elevated levels of social problems?

The preponderance of evidence demonstrates that the social problems in communities with casinos are no different than those in communities without casinos.

A study issued by the General Accounting Office (GAO), the investigative arm of the U.S. Congress, found “no conclusive evidence on whether or not gambling caused increased social problems in Atlantic City.”⁽¹⁾ And a leading business group in Baltimore looking at data from other existing gaming jurisdictions concluded that “… casinos are not likely to have a substantial impact on crime and other social problems.”⁽²⁾ 

An important—but frequently ignored—factor in assessing potential social impact is the rate of problems in a community before the legalization of casino gambling. Casinos typically are approved as an economic stimulus to a community and therefore are located in areas that have higher existing rates of problems that often are influenced by poverty.⁽³⁾

In many cases, studies have shown that because casinos are labor-intensive businesses, they can actually alleviate some common social problems.

According to research conducted for the National Gambling Impact Study Commission (NGISC), some of the most common indicators of social welfare improved with the advent of casino gaming. A report by the University of Chicago’s National Opinion Research Center (NORC) found those communities closest to casinos experienced a 12 percent to 17 percent drop in welfare payments, unemployment rates and unemployment insurance after the introduction of casino gaming.

Charles Wellford, a University of Maryland criminologist who directed a National Academy of Sciences panel commissioned by the NGISC to study pathological gambling, stated in testimony before the Maryland House of Delegates that the few scientifically acceptable cost-benefit analyses have found a net financial benefit from gambling.⁽⁴⁾ 

A comprehensive survey of casino employees supports the conclusions reached in the commission’s research. According to the PricewaterhouseCoopers survey of 178,000 employees—more than half of the commercial casino industry work force in the United States—16 percent had used their casino jobs to replace unemployment benefits, 63 percent had improved their access to health care benefits, 43 percent had better access to day care for their children, 65 percent had been able to develop new job skills as a result of their employment and 78 percent indicated that their employer provided them with training to perform their job.⁽⁵⁾

For more detailed information on social impact, refer to the questions relating specifically to bankruptcy, crime and pathological gambling.

References

1. General Accounting Office, Impact of Gambling: Economic Effects More Measurable Than Social Effects (Washington, D.C.: GPO, April 27, 2000), 3.
2. Peter Reuter, The Impact of Casinos on Crime and other Social Problems: An Analysis of Recent Experiences, Report for the Greater Baltimore Committee (College Park, Md.: University of Maryland, January 1997).
3. Personal correspondence with Howard Shaffer, Ph.D., director, Division on Addictions, Harvard Medical School, Sept. 4, 2002.
4. Testimony of Charles Wellford before the Maryland House of Delegates, Annapolis, Md., Nov. 25, 2003, 1. 
5. PricewaterhouseCoopers, Gaming Industry Employee Impact Survey (Washington, D.C.: American Gaming Association, October 1997), 2.