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Casinos may have to up ante to fill jobs

| Sunday, April 23, 2006

HARRISBURG - The legalization of slot-machine gambling in Pennsylvania has brought promises of thousands of new casino, hotel and restaurant jobs.

But attracting so many people at one time likely will pose a challenge, officials say, and the companies that win slots licenses may have to ante up additional benefits to compete with other slots parlors and find employees willing to accept long commutes.

In the Philadelphia area alone, there could be as many as five slot-machine parlors competing for workers who can commute to a booming Atlantic City -- where a major labor union already is warning of a worker shortage at casinos in the seaside New Jersey town.

Three slots parlors could be within an hour of the Pocono Mountains, where tourism operators already recruit overseas for some seasonal workers.

"I think just finding people -- finding qualified people who can deal with the public, finding qualified people who want to work those hours -- is going to be difficult," said Robert Uguccioni, the executive director of the Pocono Mountains Vacation Bureau.

Because the industry relies heavily on good customer service to entice more gambling and tipping, slots operators likely will have to offer employee wages and benefits that exceed those at other tourism and hospitality businesses, those familiar with the industry say.

The state's 14 planned slots parlors, with their restaurants, hotels, stores and other services, are expected to employ 9,000 to 15,000 people once everything is up and running, according to estimates provided by license applicants.

Generous benefits are common in the casino industry.

Workers from executives to housekeepers in major casino states typically get full medical benefits, 401(k)s and more. Some casinos subsidize bus passes, dangle annual "stay-on" bonuses and launder employee uniforms.

In farther-flung areas of Nevada or on Indian reservations, casinos have built or subsidized employee housing. In Atlantic City and Las Vegas, workers get free cafeteria food -- sometimes three meals a day.

Pennsylvania applicants that run casinos in other states will be accustomed to providing such benefits, but the practice could surprise those new to the business.

"The independents, the guys who are not familiar with the benefits, are going to have a very hard time matching the benefits that the big guys offer," said Mike Shubic, a Colorado-based casino executive for Jacobs Entertainment who has opened casinos in four states.

While two or three slots parlors will be in downtown Pittsburgh and Philadelphia, others could be in rural areas.

Finding ways for those casino employees to live close to work should be looked at by state regulators, said Raymond S. Angeli, who recently was appointed to the Pennsylvania Gaming Control Board after more than a decade on the Pennsylvania Housing Finance Agency board.

"I think you're going to have to have some kind of housing near where you have the casino," Angeli said. "Let's face it ... the people who are working in those facilities have to come from someplace, and that's usually a population that's not going to drive very far."

Prospective casino operators say they are not worried. While some say employees may have to drive 45 minutes or so to get to work, they expect demand for the jobs to be high.

Some say they will hold local job fairs and work with colleges to train workers, while others say they will coordinate with the state to reach out to the unemployed.

Some will recruit casino employees in other states and possibly even overseas.

"We've looked at who are our employees going to be and is there enough of a population to draw from, and we've determined that there is," said Rob Stillwell, a spokesman for Boyd Gaming Corp., one of the nation's biggest casino companies and an applicant for a casino to be built on farmland between Philadelphia and Reading.

It is hard to tell whether most gambling jobs in Pennsylvania will beat the state's average annual wage of $37,600.

SugarHouse Gaming, which wants to build a slots parlor along the Delaware River in Philadelphia, said it plans to pay an average of $40,000 in annual wages and benefits. Donald Trump's casino company plans to spend about $39,000 per employee at its proposed TrumpStreet casino on former industrial land in the city. And Aztar Corp., which hopes to build the Lehigh Valley Tropicana in Allentown, said it plans to spend an average of $35,000.

But those figures do not include tips, which can mean $10,000 or more a year for many casino workers.

"For that many jobs you need a broad reach geographically to find enough people who would be interested in that level of pay," said Stephen P. Schappe, a professor of management at Penn State's Harrisburg campus. "How far is someone willing to drive ... for a job that's in that salary range• It's a tremendous challenge."

Data gathered by the American Gaming Association show the average wages, tips and benefits of employees at commercial casinos in 2004 ranged from about $24,200 in Louisiana to $48,360 in Michigan.

Top managers can make six figures, while tipped employees -- hosts, bartenders, food and drink servers and slots assistants -- sometimes can earn more than midlevel supervisors or white-collar workers.

The lowest earning positions are those that do not deal with the public, such as clerks, warehouse staff, cooks, hotel maids and janitors.

Wage scales for bell captains in Atlantic City who are represented by UNITE-HERE Local 54 start at $5.90 an hour and top out at $10.61 after seven years, according to the union. Cooks start at $9.89 and top out at $17.86.

The 16,000 employees represented by Local 54 -- about 1,000 of whom come from the Philadelphia area -- do not contribute to the casino-sponsored health insurance and pension plans, said Chris Walker, the union's staff and organizing director.

And if benefits are good now, they are likely to get even better as the industry grows and labor supply tightens even further, Walker said.

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