Union Leaders Demand Almost 70% More Wages Than Casinos Are Willing to Offer

It has been a long four weeks at Detroit casinos as the ongoing union workers strike continues to take a toll on retail gaming in the city. Even worse is the fact that casino leaders are unwilling to budge, thereby stalling negotiations. This has caused many union workers to “prepare” themselves for a longer strike period that they could have reasonably anticipated.

The 3,700 workers currently on strike represent 75% of the total workforce at Detroit casinos, according to a US Bureau of Labor Statistics which put the total workers at 4,900. Here’s a quick look at what Detroit casino workers are currently demanding. 

Negotiation Terms Between Casino Workers and Management Leaked on Social Media
There’s now some clarity as to the position of unions and casino operators as the strike hits its fourth week, heading to the fifth. Just as it was at the beginning of the industrial action, wage increase and healthcare services stand as the major point of disagreements.

Union workers are of the opinion that a new wage structure is due after their most recent increment came with a 3% raise during the pandemic in 2020. As far as negotiations go, both sides of the divide have been firm in the proposal but yet to reach conclusive agreements. Leaked information on social media suggests that unions are clamoring for a $3.25 per hour wage increase as against the $1.95 per hour raise that casino owners are willing to offer.

On the healthcare spectrum, union workers are enraged by the amount casinos require for staff coverage. The casinos are willing to reduce the cost of health from $60 to $40, but the workers are adamant for a complete elimination of the amount workers’ pay for healthcare. 
Union leaders have further confirmed that the figures highlighted by the social media leak are a correct reflection of actual negotiations. However, discussions will still continue until both parties are able to reach a meeting point, hopefully in the near future.

With casinos having about 75% of their staff behind the picket lines, there was no doubt that the economic impact would be substantial. Reasonably, retail casino strikes would mean the physical gaming floors function less than optimally, leading to lower revenues while Michigan online gambling activity increases. However, we are yet to see how that plays out since October’s revenue figures are yet to be released.

Nonetheless, we can make some projections.

Firstly, it’s noteworthy that the number of workers currently involved in the strike is not an exact reflection of the current working capacity at the different retail locations. Information from credible sources show that most of the casinos were operating close to half capacity. Albeit some gaming sections and floors stay closed with sports bettors now directed to kiosks to place their wagers.

In the first nine months, Detroit casinos have already generated approximately $960 million, across sports betting and slots and table games. This brings their aggregate revenue per month to $106 million per month, and $3.5 million per day through that period. 
Comparing all of these factors, we can safely put the amount that casinos are losing to the strike between $1.5 million to $2.5 million.

Union workers have started a donation drive to gain support from the general public. They are calling for donations of essential items, including winter clothes as temperatures start to drop. On Tuesday, November 7, they also marched to the city hall, clamoring for a “Detroit Strikers Bill of Rights.” This way, they hope to enjoy certain legal protection designed for the safety of workers participating in the industrial action.

Based on our calculations, casinos are projected to lose at least $22.5 million in October alone. That could bring the monthly revenue for that month at around $80-$90 million. If this happens to be the case, the Detroit arm of Michigan gambling would suffer its lowest monthly revenue since February 2021. Worst case projections could even see casinos go lower to the ranges of $60-$70 million, representing possible huge losses for operators.