Tender process for Macau licenses to begin on Friday as casinos prepare to face post-pandemic staffing shortages
According to a recent announcement by the Macau government, the bidding process for the casino license is scheduled to begin on Friday, July 29 and last until September 14. Global gambling operators wishing to remain in the city must bid for new permits alongside new players also vying to operate. Companies are required to provide a guarantee of at least 10 million patacas ($1.24 million) and submit the required qualification documents.
According to a statement released Thursday, when bidding, “special attention should be paid to the development of foreign tourism markets, experience in the operation of casino games, investment in gambling and non-gambling projects for the benefit of Macao, casino management plans, plans for monitoring and preventing illegal activities and social responsibilities”, reports by Reuters.
Failure to secure new contracts, expected to start in 2023, means current operators will be banned to operate casinos on which they depend for their business and in which they have invested billions over the past two decades. Licenses for current casino operators, which includes Wynn Macau, Sands China, MGM China, Galaxy Entertainment, SJM Holdingsand Melco Hotels – will expire on December 31.
The draft rules for the process were released earlier this month and came after the government passed the amended Macau Gambling Law last month.which marked the biggest legal reforms for the industry in two decades.
Concession contract extensions signature at Macau's Government Headquarters in June
Earlier this week, the government announced the creation of a nine people Commission for the public adjudication of concessions for the operation of the Casino Jeux de Fortune. The committee has the power to analyze and resolve all issues relating to the public tender process and relating to the formulation of concession contracts. Exceptions are either provisional adjudication or actual adjudication of bids; and other matters specified by law as being the responsibility of other entities.
The gaming center casinos reopened recently after being closed for almost two weeks mandated with the aim of stopping the spread of Covid-19. However, due to travel restrictions still in place, low tourism is provoking companies be slow for game rooms, and analysts have estimated the closures could cost casinos $1 billion.
Even if he is allowed to resume his activities, casinos are required to limit staffing to 50% of normal and must follow strict disinfection and health guidelines. Employee restaurants are banned and local citizens have been ordered not to go out except for food or in an emergency.
According to experts, the casino industry as a whole is expected to experience a staff shortage once the economy returns to normal and operators should have a clear plan to re-employ staff who have left. Andrew Klebanow, co-founder and senior partner of C3 gamesaid that Las Vegas, to this day, is still understaffed, following the closure of casinos during the peak of the pandemic.
In an online seminar French Chamber of Commerce (FMCC) titled “The road to tourism recovery in Macau”, the gaming consultant said that not only are they understaffed in the hospitality industry, but also in all sectors of the economy. He explained that American casinos are just one of many industries struggling to recruit new workers.and they find themselves competing not only for casino workers, but also for people with experience in the hotel, restaurant and tourism industries, to name a few.
“I suspect you will have this problem as well, given how many of your expatriate employees have left. There are just a lot of people who left. Many expats have returned home and are very reluctant to return. They just said they were done,” Klebanow said of Macau.
“You have to plan for this. What will it take to get these employees back and get them back quickly when does business start? Because you’ll find yourself not finishing hotel rooms on time and not getting people into restaurants,” he added, as reported. Macau Daily News.
Rutger Verschuren, chairman of the FMCC and president of the Macau Hotel Association, said he also expected to see the same problem in Macau. “We have to be ready. […] A room attendant can handle 12 to 13 rooms per day, depending on the property. Considering there are 40,000 rooms in Macau, we need more room attendants for that,” he added.
Analysts say casinos have had near-zero revenue since mid-June, when the city’s epidemic began, and they are should have little or no income in the coming months. Even before they closed, analysts believed that casinos were burning some $600 million every month because of related to the pandemic limitations.
The latest lockdown has wreaked havoc on the sector, as it had been struggling since the start of the pandemic, with revenue drops 70% in 2021 from 2019 to $10.8 billion. Macau casino stocks also fell dramatically, between 21% and 76% since 2020as the city adheres to China “zero-COVID” policy which aims to curb all epidemics.