Over 3,700 casino workers in Detroit have announced a strike against three major casinos in the city after the breakdown of contract negotiations over the summer. The casino workers are demanding higher wages and improved working conditions as the cost of living in the United States continues to skyrocket.
The Detroit Casino Council (DCC) consists of five unions. These five unions are working at three major casinos in the city – MGM Grand Detroit, MotorCity Casino and Hollywood Casino at Greektown.
According to the DCC, casino workers are demanding higher wages to keep up with the rising cost of living; a reduced overall workload without a decrease in pay; and better healthcare and retirement benefits.
As inflation continues to increase, these workers want to regain lost ground after agreeing to a three-year contract extension in 2020 that only gave them a wage increase of three percent. The said increase has been sorely inadequate, given the 20 percent rise in the cost of living caused by high inflation. (Related: Monthly expenses of Americans have now outpaced their personal income growth, says NRI exec.)
In a statement, the DCC pointed out that Detroit's casino industry made $2.27 billion in gaming revenues in 2022 and is on track for another record-breaking year by December. The three Detroit casinos the workers are striking against collectively reported earning $813 million more in gaming revenues in 2022 than in 2019.
"But total wages paid to workers represented by the DCC were $34 million less when comparing [2022 and 2019]," wrote the DCC.
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Gwen Mills, Secretary-Treasurer of Unite Here, one of the unions involved in the negotiations, spoke on behalf of the workers. "They are not budging on a fair wage," she said. "We took almost flat wages through the pandemic and now expect to share in the prosperity that they're experiencing."
Detroit, casino operators to lose big if strike continues
Traditional casinos made $1.2 billion in 2022, which was $200 million less than in 2019 before the Wuhan coronavirus (COVID-19) pandemic. The revenue figures of the DCC include money earned from online gambling and sports betting.
If the strike continues, it could mean a potential loss of about $738,000 in taxes for Detroit and $3.4 million in earnings for the casino operators each day.
As a result, MotorCity Casino has had to make changes to its operations. It has temporarily closed high-stakes tables, poker rooms, valet service, as well as its spa and selected dining and drinking establishments.
FanDuel, which operates the FD Sportsbook in conjunction with MotorCity, also announced its closure, except for a non-union employee managing cash transactions.
Hollywood Casino at Greektown, on the other hand, intends to continue operations during the strike. However, it issued a statement to CNBC.
"We are disappointed by the decision of the Detroit Casino Council, as we have made generous, progressive settlement offers that position our team members and business for sustainable success."
Matt Buckley, president and COO of MGM's Midwest Group, expressed the same sentiment. But unlike Hollywood Casino, Buckley communicated with employees through a letter.
"Regarding the status of our negotiations, we've made six proposals to the union, and our current offer includes the single largest pay increase in the history of MGM Grand Detroit. It is a significant proposal," Buckley wrote.
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