Unite Here’s members offer cleaning services for hotel rooms, gaming floors, and restrooms in Atlantic City’s casinos. The union released a strike impact report after workers at five Atlantic City casinos voted in favor of a strike, with a 96% majority, on June 15th. The vote included employees from Caesars Entertainment’s three Atlantic City casinos (Caesars, Harrah’s, and Tropicana), as well as staff from MGM Resorts Entertainment’s Borgata casino and the Hard Rock casino.
The strike impact report estimates that Caesars could lose approximately $1 million per day in EBITDA as a result of the strike. This estimate assumes a 10% year-on-year increase in Q3 2022 results for Caesars and a 25% yearly decline in net revenue due to the strike. Similarly, the report suggests that MGM’s Borgata could face a loss of around $1.6 million in EBITDA under the same assumptions.
According to the report, the strike may disrupt operations in terms of food and beverage availability, customer service quality, and hotel room occupancy. The tight labor market could further exacerbate these effects. It’s worth noting that the most recent Unite Here strike occurred in 2004. The strike deadline is set for July 1st, just ahead of the July 4th holiday, which is also expected to be the peak of the third quarter. The report highlights that Caesars earned 15% of its total earnings from its Atlantic City properties last year, making it particularly vulnerable to the impact of this industrial action.
