The American Gaming Association has noted that strong growth over the past two years has positioned the industry well despite future uncertainty, with gaming CEOs said to be positive about the current business situation.
Presenting an outlook for the road that lies ahead, in partnership with Fitch Ratings and prepared by Oxford Economics, three in four CEOs surveyed (76 per cent) expect the pace of wage and benefit growth to continue to increase over the next three to six months.
The survey, conducted between August 30 and September 6, 2021, saw a total of 26 executives respond, with indications that the situation is good (68 per cent) or satisfactory (28 per cent), with most (92 per cent) expecting it to continue or improve over the aforementioned time frame.
More than one third (38 per cent) indicated they expect future conditions to be better, compared to only eight per cent that thought they would worsen.
Despite the widespread positivity, two-thirds (65 per cent) of CEOs responding cited supply chain issues as a factor limiting operations.
Further challenges highlighted as impeding business growth included inflation and interest rate concerns (62 per cent), the uncertainty of the economic environment (50 per cent) and shortage of labour (50 per cent).
For operators, future customer activity is said to be a major question mark, with expectations evenly split between expansion and contraction.
On the supplier front, half expect the sales of both new and replacement units to increase over the next two quarters, while none anticipate a decrease.
“Our industry remains cautiously optimistic—and has weathered this volatile economy— because of resilient consumer demand,” said Bill Miller, AGA President and CEO.
“Looking ahead, future consumer confidence and spending remain an outstanding question for our continued growth.”
Moreover, the outlook also includes a pair of separate indices, with a ‘Current Conditions Index’ of 99.5 showing that gaming-related economic activity is relatively stable compared to Q2 2022, when the industry set a new quarterly revenue record.
It is added that the Index indicates that gaming-related economic activity has grown at a pace of approximately 4.9 per cent over the last three quarters.
A ‘Future Conditions Index’ of 95.3 highlights that economic activity is expected to decrease moderately over the next six months at a 4.7 per cent rate.
While the growth expectations of the gaming executive panel remain positive, this is dampened somewhat by the current Oxford Economic outlook that anticipates a mild recession in the first half of 2023.