A City Built on Sand - Just One More Hand: Life in the Casino Economy (2015)

Just One More Hand: Life in the Casino Economy (2015)

Chapter 2

A City Built on Sand

Unlike many formerly industrial cities of the northeastern and midwestern United States, Atlantic City has service in its bones. Located on a relatively thin strip of barrier island—Absecon Island—off the coast of southern New Jersey, the so-called Queen of Resorts was created and marketed as a beach resort. The Philadelphia-Atlantic City Railway Company started bringing Philadelphians to the shore after the Civil War, back when “seabathing” was a radical new pastime. Tourism has been at the heart of the economic health of Atlantic City ever since. In 1870, an innovation in publically funded infrastructure was born with the installation of a mile-long walkway of wooden planks on the sand for visitors—the first U.S. boardwalk. A more permanent version was built twenty-five years later, and its street name—Boardwalk—became official. Boardwalk eventually became venerated as the most valuable of the twenty-two colored streets in the original version of the board game of Monopoly, streets whose names all came from the famous resort (or nearby towns).

A growth spurt ensued. Boardinghouses were followed by elegant resort hotels. The population grew from 2,000 in 1875 to almost 30,000 by the turn of the century. The bulk of the service work for tourists was performed by African American workers who initially migrated from nearby southern states only during the summer months. In Boardwalk Empire, first published in 2002, Nelson Johnson wrote that “While the money to build a national resort came primarily from Philadelphia and New York investors, the muscle and sweat needed to keep things going was furnished by Black workers.”[1] Foreshadowing the first Great Migration, African Americans started immigrating to Atlantic City in the 1870s, and by 1915 the resort had became the most “Black” city in the north, according to Johnson. Hotel and restaurant work paid better wages (and tips) than the private domestic service employment that most African Americans found in northern cities. They were quickly joined by Irish, Italians, and Jews, who came for jobs in construction as well as tourism. Sicilians settled in Ducktown, a neighborhood around St. Michael’s (Catholic) Church, when they were hired following a strike by African American waiters in 1906. Jewish and Irish families were less ghettoized, gradually settling in the South Inlet and other neighborhoods.[2]

Atlantic City took pride in its growing hospitality industry. The resort became popular with working- and middle-class whites who could act out rituals of prosperity as they dressed up to stroll the Boardwalk or ride in rolling chairs pushed by African Americans. The city and its workers took care of a customer’s wants and desires, even during Prohibition (1920-1933): bathing on the beach during the day and cavorting at clubs late into the night. Hollywood portrays this golden age in the HBO television series Boardwalk Empire, with protagonist “Nucky” Thompson, based loosely on the real-life Nucky Johnson described in Nelson Johnson’s (no relation) book of the same name. The revelry continued after ratification of the Twenty-First Amendment once again legalized sales of alcohol, and Atlantic City became known for its nightlife.

The city began a long-term economic decline following World War II that accelerated in the 1960s. As tourism slowed during the war, Atlantic City housed (single male) soldiers between deployments overseas who were, as historian Bryant Simon noted, “hard on the hotels.”[3] Local lore tends to place particular blame on bad publicity following the August 1964 Democratic National Convention at Boardwalk Hall. Folks who came to town to nominate the incumbent President Lyndon B. Johnson found that hotels were not kept up to high standards. What was once the city’s strength in meeting customer needs was now its weakness. The city found it very difficult to stem the tide of reporters spreading the word in print and informally about the city’s urban decay and poor services.

The decline of the Queen of Resorts as a favored tourist destination was, however, years in the making and can be attributed to many factors, from the rise of air travel and air conditioning to a suburbanization of vacation destinations that mirrored white flight from urban living.[4] These factors explain why the hotels were not renovated once the soldiers left. Gaming analyst Michael Pollack (managing director of Spectrum Gaming Group) refers to this period from the 1940s through the late 1970s as an “Age of Divestment,” as local business owners saw little prospect of return on any capital improvements.[5] While the industrial Midwest—and with it, much of the U.S. economy—was enjoying unprecedented prosperity due to the dominance of U.S. manufacturing, Atlantic City was falling behind. Atlantic City was not unique; many of the processes that fed its decline also affected non-tourism-related urban areas in the 1960s and 1970s. Jane Jacobs was already describing urban decay as early as 1961 in her landmark book The Death and Life of Great American Cities.[6]

Major changes in tourism were nonetheless key. With more middle-class wives employed, leisurely summers spent “down the shore” (with Dad commuting to visit on weekends) became a relic of the past. Air conditioning made cool ocean breezes less imperative. Meanwhile, tourists in the postwar period had new alternatives for their vacation dollars. The affordability of the automobile and policies promoting suburbanization, while a boon to the U.S. economy as a whole, sucked the life out of many cities.[7] Our growing car culture meant that tourists could take to the open road and vacation wherever their automobiles could take them. And their cars could take them further than ever before, thanks to the national Interstate Highway System created with passage of the Federal-Aid Highway Act of 1956. By the time a new expressway from Camden County, New Jersey (across the Delaware River from Philadelphia), to the southern New Jersey shore was completed in 1965, it was too late to resurrect the resort to its heyday.

Americans also increasingly took to the air to get to their leisure destinations. With the development of pressurized and heated passenger cabins by the airline industry, air travel became more accessible in the 1950s and 1960s. “Out” was Atlantic City. “In” were Florida and California, including Disneyland; the theme park opened in Anaheim, California, in 1955. In the words of Bryant Simon in his book Boardwalk of Dreams, “Disneyland’s fantasy world centered on Main Street, a less urban, small-townish version of the Boardwalk.”[8] Overseas getaway destinations included Bermuda, the Bahamas, Acapulco, Hawaii, Europe, the islands of the south-Asian Pacific Ocean—basically wherever Pan Am and TWA (Pan American Airlines and Trans World Airlines) flew.

Just as Joseph Schumpeter would have predicted, the maturing industry, resting on its laurels, was pushed aside by emerging enterprises: The creative entrepreneurship of Walt Disney, Conrad Hilton, and others contributed to Atlantic City’s “destruction.” There were not enough consumer dollars to maintain Atlantic City’s great hotels. As a result, many of them closed or were converted to boardinghouses. By the time visitors arrived for the Democratic National Convention in 1964, Atlantic City, no longer enticing and exotic, seemed past its prime.

The economic stagnation affecting the United States, including New Jersey, from 1970 to 1975 further impacted Atlantic City. According to U.S. Census data, the city was becoming ever more black and elderly. Income was falling, and it was income that was needed to generate local spending and jobs. In addition to declining income and job losses, a key barometer is retail activity. According to George Sternlieb and James Hughes, authors of The Atlantic City Gamble, dollar sales in the Atlantic City central business district fell 12.4 percent from 1972 to 1977 and 119 retail establishments closed.[9] French director Louis Malle filmed the best picture Oscar-nominated movie Atlantic City, starring a young Susan Sarandon and the seasoned actor Burt Lancaster, partly on location in 1979. By then, Atlantic City’s old resorts and piers were in conspicuous disrepair. Some had already seen the wrecking ball and others would soon, making way for new casino properties.

In the early 1970s, New Jersey leaders began to strategize to bring Atlantic City back, and proponents of gambling as a means to do that lobbied for some kind of exception to New Jersey’s constitutional gambling prohibition. Proponents promised new commercial and residential construction and, with it, economic development and jobs. They faced some significant obstacles. Long before the television shows The Sopranos or Boardwalk Empire, New Jersey was associated with organized crime in the public imagination, and so was Las Vegas gaming.[10] It took two tries to get approval from New Jersey voters.

In the first proposal to legalize casino gambling, there would have been state-owned casinos rather than private businesses. This version also incorporated a local option, meaning any of New Jersey’s twenty-one counties could have chosen to permit casino gambling.[11] But many citizens were not immediately open to the idea. There was great trepidation about the social costs of gambling. The New Jersey Council of Churches rallied in opposition. New Jersey voters defeated this first referendum at the polls on November 5, 1974, with only 40 percent in favor and 60 percent opposed. Industry analyst Michael Pollock, author of the book Hostage to Fortune: Atlantic City and Casino Gambling, puts it this way: “New Jersey’s voters were frightened of casino gambling in 1974. They feared a long, dark association between casinos and organized crime.”[12]

Gaming proponents, under the auspices of the Committee to Rebuild Atlantic City (CRAC), redoubled their efforts. The second time, a revised proposal would allow privately owned casinos, but in Atlantic City alone. Generous donations to the cause came from Resorts International and other powerful economic interests.[13] Resorts had already purchased the old Chalfonte-Haddon Hall Hotel in anticipation of converting it into a casino. In a more polished and professional campaign that followed the initial defeat, there were bumper stickers, pennants, lapel pins, postcards, and other giveaways urging voters to approve casinos. One campaign button read: “Help Yourself. Vote ‘Yes’ Casinos in Atlantic City Only.”

Casino Referendum Campaign Items.

Courtesy: Atlantic County Historical Society; Photo credit: Susan Allen

Strategists attempted to convince voters that “The acceptance of the casinos in the city was … a matter of urban life and death.”[14] A brochure promised that a “yes” vote would help:

balance taxes

create jobs

boost the economy

cut down on street crime

Job creation was pivotal. “The need for more and better jobs is critical throughout the State of New Jersey, a State with a 12% unemployment rate,” states the brochure. According to a 1983 study, “The promise of employment played the largest part in winning endorsement for casino gaming.”[15] Local residents campaigned vigorously for the initiative, believing in the promise of good jobs. Zoe, still in high school at the time, remembers that her stepfather, who worked at a local hotel, was very anxious for the referendum to pass. The revised referendum also specified that tax revenues raised through gaming would be allocated to programs to benefit New Jersey’s senior citizens and the disabled. New Jersey voters anticipated lower taxes due to the revenues that casinos would generate. Yet, by geographically segregating the casinos in a largely African American city, voters in the rest of the state could minimize social costs to their own communities.

“Yes” Casinos Brochure.

Courtesy: Atlantic County Historical Society; Photo credit: Susan Allen

New Jersey’s policy makers determined that casinos would be highly regulated, in part to alleviate concerns about organized crime. Two state agencies were created, each with distinct regulatory responsibilities: the Casino Control Commission (to approve and issue licenses) and the Division of Gaming Enforcement (to investigate violations of the Casino Control Act). Casino operators and their vendors needed licenses, with the burden of proof on the operator to demonstrate their lack of ties to corrupt individuals. Nelson Johnson, in his evocative style, compared the licensing process to a proctology exam.[16] Holding a casino license was treated as a privilege, not a right. Originally, all employees needed to be licensed by the Casino Control Commission. (Today, only casino managers and employees directly involved with gaming operations, as opposed to hotel or restaurant services, undergo licensing.) Details of casino operations were controlled as well. Initially, for example, state regulators restricted gambling to only eighteen hours per day during the week and twenty hours during the weekend; these restrictions were gradually loosened and the casinos have operated 24/7 since 2002.

There would be minimum hotel size requirements, unlike in Las Vegas, so that investors and entrepreneurs would only erect glitzy gaming halls with hotel rooms, dining, and entertainment for visitors.[17] New Jersey policy makers viewed their approach as distinct from that of Las Vegas, which they viewed as “tacky” and singularly focused on gambling. According to gaming attorney Nick Casiello, Jr., “Casinos were intended to be an ‘additional element in the hospitality industry’ and not just ‘the industry unto themselves.’”[18] A phrase that dates back to the Casino Control Act—and that labor leaders cling to today—is “first class”: Atlantic City’s casinos were supposed to be first-class operations that offered diverse entertainment options and quality accommodations that created middle-class jobs and that helped develop the city beyond the walls of the casinos. The second time, in 1978, proved to be the charm. The referendum passed with 56.8 percent voting in favor.

Resorts International Casino became Atlantic City’s first legal casino, opening with great fanfare on May 26, 1978. Anticipation had built for months. The city had 8,000 hotel rooms at the time and they were fully booked. There was a long line outside after Governor Brendan Byrne—a major proponent of Atlantic City gaming—cut the ribbon. During that opening Memorial Day weekend, Resorts booked entertainers Steve Lawrence and Eydie Gormé as headliners. A bit of trivia: Steve Lawrence opened the craps table at Resorts with a $10 bet on the pass line and rolled a five; next he rolled a seven and lost. By all accounts in the media, Atlantic City’s gamble would be more of a success.

People jumped at the chance to land the new jobs. Caroline quit college when Resorts opened to become a dealer. Her family’s business had just gone under. Caroline recollected, “I thought I would just do it for a while and then I would go back and get my accounting degree… . I’m still there.” She married a casino worker and her son is now in the industry. Zoe had just finished high school when Resorts opened. Her whole family was excited about the prospect of working in the new casino. They sat down as a group to complete the lengthy sixty-page application to become licensed to work in the casino. Her mother, stepfather, older brother, and older sister all got licenses and jobs in the industry. Starting in a job in “soft count” (i.e., counting cash or banknotes), Zoe’s mom became a dealer, then a waitress, then a coat checker. The job as a “coat check girl” was “Mom’s” favorite because the tips were good and she was laid off each summer when no one wore heavy coats. As happens when someone is a cop or a carpenter or a coal miner, family members helped usher other relatives into the new gaming houses. This practice has continued, even as the mostly Italian, Irish, Jewish, and African American workers from the early days have been joined by Latino and Asian immigrants and their families.[19]

Job seekers soon had other opportunities besides Resorts. As conveyed by Michael Pollock, Resorts’ corporate profits increased 1,600 percent in the first seven months of operation. He adds: “The race was on. Old hotels went down and steel frames went up. Atlantic City glowed with the flushed face of a gambler holding four aces.”[20] Nine casinos, including the majority of properties still in operation, opened between 1978 and 1981: Caesars and Bally’s, the next to open after Resorts, in 1979; the Brighton (which became the now-imploded Sands), Harrah’s, and the Golden Nugget in 1980; and Tropicana and Claridge in 1981. Even Playboy had an Atlantic City casino for awhile, opening one in 1981. The initial investment of the first nine Atlantic City casinos was well over $1 billion;[21] this is equal to almost $2.9 billion in today’s dollars. Economist Oliver Cooke, writing in a 2009 retrospective on Casino Gaming in Atlantic City, notes that this initial build-out phase “was marked by rapid job, income and population growth,” strong enough that the Atlantic City economy significantly outperformed the state and the nation in the midst of a five-year period of macroeconomic growth. Employment in the city grew 21.7 percent from 1978 to 1980, far more than the 4 percent growth rate in the United States and New Jersey as a whole.[22] (We present a detailed timeline of the Atlantic City casino industry in an appendix in the back of the book.)

After the initial burst from 1978 through 1981, erection of new casino properties slowed but did continue. During the U.S. macroeconomic expansion of 1982 to 1990, Atlantic City saw the opening of the Trump Plaza (in 1984), Trump’s Castle (in 1985), Showboat (in 1987), and Trump Taj Mahal (in 1990). After the opening of the Trump Taj Mahal, referred to as “the Taj,” no new casino properties were built in Atlantic City for more than a decade; only renovations occurred. The energy for new construction shifted to new opportunities in other states. The majority of the changes within the industry in the 1990s were ownership changes and several casinos were reorganized following bankruptcy filings—trends that would continue into the 2000s and 2010s.

Many of the first casino executives were large personalities, and longtime employees still talk about key figures from the old days, contrasting them with today’s corporate management. “The whole Atlantic City was run by guys from Vegas. They were cowboys. They were old-school cowboys,” exclaimed SueBee, who worked briefly at Resorts before opening the Golden Nugget. Her boss, Casino mogul Steve Wynn, was an early entrant into the Atlantic City market with the Golden Nugget in 1980. He later sold it to Bally’s in 1987 and left Atlantic City to develop the new wave of mega-casinos in Las Vegas, Macau, and elsewhere. Describing the changes she saw in the building she worked in for twenty-eight years, SueBee recalled, “It definitely changed after Steve Wynn left. It was not, you’re part of a big corporation… . Steve Wynn—this was his casino in Atlantic City. This was his diamond.”

Hugh Hefner’s Playboy Casino had to take on a financial partner before the Playboy Bunnies could open the casino’s doors in 1981. Nana, whose job was to dress the Bunnies and take care of their costumes, remembers the atmosphere as fun and exciting, and quite a contrast with her former jobs in Philadelphia factories and laundries. Donald Trump expanded his business as a hotel developer and came to Atlantic City in 1984, eventually building three properties that bore his name. His relationship to the casinos fluctuated with his economic circumstances, but two of them continue to use the name “Trump” even though “the Donald” is no longer an owner. A Day One employee, Donna, identified Ivana Trump (former wife) as taking a strong role in guiding Trump Castle/Marina in its early days. Ivana was “meticulous”; in later years, Donna claimed, the property became “Trump’s Dump.”

These years represent the strong initial spurt of a relatively infant industry and mirror strong growth rates in the service sector nationwide. Only the second location in the United States (not including Puerto Rico) to legalize casino gaming, and the first near the major population centers on the Eastern Seaboard, Atlantic City was an industry innovator. Employment grew almost every year during the first twenty years of legalized gaming and peaked at 49,123 employees in 1997. As shown in figure 2.3, growth was most notable during the years when new casinos opened; however, employment declined in three years (1989, 1991, and 1993). The 1990-1991 recession brought the only year of appreciable decline, as employment fell 2.9 percent in 1991. Optimism was so high that in 1998 the New Jersey Casino Control Commission predicted an increase to 75,000 full-time and part-time jobs in the industry by about 2003.[23] Such estimates, as the figure also demonstrates, were vastly overconfident.

New Jersey Casino Employment, 1978 - 2013 (at year end).

Note: Casino work that is outsourced (e.g., an independently-owned restaurant) may not be included in these totals even though the employees work at the casino property. Source: New Jersey CCC annual reports until 2010, then DGE website.

Despite the promise of economic development beyond the walls of the casinos, many analysts and critics concluded that the initial wave of casinos did not reinvigorate the city.[24] Ironically, the requirement that casinos offer diverse entertainment options may have contributed to the problem. Few casino patrons left the buildings to visit local restaurants and shops. The casinos provided gourmet dining on site. They kept the customers inside, in a controlled playland without windows or even clocks that told time. There were no views of the Atlantic Ocean, the beach, or the renowned Boardwalk. Visitors arriving by bus or car and disembarking in garages could have been anywhere. Local businesses and local residents generally missed out on gains from the gaming operations. Zoe, whose family worked on the campaign to pass the casino referendum, voiced her disappointment with the outcomes for the city: “My thought on Atlantic City is: they came in and kind of robbed it for what it was worth and then left. They built these boxes and put everything that they wanted inside the box and they wanted you to stay in the box. And they didn’t care if the Boardwalk fell apart; they didn’t care if everything around them was parking lots with litter… . The more, the better, because then you were going to stay in the box. They provided everything you could possibly need in the box so, ‘Don’t go out there; you don’t need to go out there!’ So, the vision that my family, my mother, thought was going to happen with casino gambling—that they were going to bring in and revitalize Atlantic City—was nothing. They did nothing.”

There were winners, however, particularly business owners in the nearby suburbs. The powerful construction industry benefited from new construction and periodic renovations. Ancillary businesses that provided services to the casinos also flourished.[25] Unfortunately, as noted by anthropologist Joseph Rubenstein in a 1984 article, “most of the money is obviously being spent outside Atlantic City. For example, of the 383 businesses that list themselves as food suppliers to the casinos, only 75 have Atlantic City addresses, and most of those are small sandwich shops rather than large-scale purveyors. Of the 221 office supply and furniture dealers, only 16 are local.”[26]Reflecting back on the period from 1977 to 1980, Oliver Cooke echoed that it was the larger metropolitan area that “gained 0.7 jobs for every one hotel (casino) job generated during this period,” outperforming the state and national economies.[27]

In response to concerns about the lack of spillover effects on the Atlantic City community, the Casino Reinvestment Development Authority (CRDA) was formed in 1984. This agency, unique to New Jersey, channels a portion of casino revenues (state-mandated taxes and/or investment in CRDA bonds) into local redevelopment and directs some monies to other areas in the state.[28] CRDA (pronounced by locals as crē’da) also provides tax incentives for entertainment and retail development in Atlantic City. CRDA has funded numerous urban revitalization projects since its founding, within Atlantic City and across the State of New Jersey. From 1984 to 2012, it reinvested $1.5 billion in Atlantic City—in areas such as housing, public recreation and entertainment, education, and infrastructure improvements. Still, much of CRDA’s investment activity today is aimed at maintaining the gambling industry’s competitive position, as elaborated in chapter 7.[29]

Employees who reminisce about the early days describe a period when Atlantic City attracted high rollers from all over. They bet large pots, dined extravagantly, and tipped generously. One waiter described serving a meal worth $20,000, including $2,000 in food and most of the rest for an obscure wine ordered to impress other guests. The gossip about particular gamblers was passed around to coworkers and friends. “Oh, you must have heard the story about ‘So-and-So,’” we were told. “No?!? Everyone knew him back in the day!” The patrons who could afford to lose money—or who were at least determined to look like they could afford to throw money away—sustained a shared fantasy with the employees about the glamorous pleasures of gambling.

The reality, however, was that high rollers could not sustain the casinos by themselves. Unlike Las Vegas, Atlantic City never took off as a market that draws gamblers by air. Atlantic City’s comparative advantage was its location on the densely populated East Coast. While some private planes brought high rollers and casino performers to Bader Field—a small airport within the city limits—or to the larger Atlantic City International Airport ten miles outside the city, most casino traffic came by automobile and bus. (Bader Field closed in September 2006.)

Bus patrons were generally not wealthy gamblers. Bus patrons from major cities were often given vouchers that could be refunded for part or all of their fare, making the transportation costs of an excursion free or extremely cheap. These rebates were originally given in cash, but this meant that riders did not have to gamble once they arrived. Eventually, as technology shifted, the rebates could be given in “slot dollars” (credit on a casino’s loyalty card that can only be used to gamble). The train from Philadelphia, popular earlier in the twentieth century, accounted for less than 1 percent of total visitors during the casino era, according to data from the South Jersey Transportation Authority (SJTA) analyzed by Anthony Marino.[30] Philadelphia is only 62 miles away. New York City is 126 miles north of Atlantic City. Baltimore is 154 miles south. The 45-mile-long Atlantic City Expressway, with two or three lanes in each direction, proved to be the fastest and most inexpensive way to reach the city. Thus, any gambling competition within Atlantic City’s “market,” a 100-to-300-mile radius driving distance, or less than a one-day drive, would strike a blow. And it did.

Starting in 1989, Nevada and New Jersey lost their status as the only places in the United States where people could gamble in a casino. Iowa, Louisiana, and South Dakota legalized casino gambling that year, followed by Colorado, Illinois, and Mississippi a year later. The opening of the Mirage casino in Las Vegas, also in 1989, marked an era of renewed investment in that city. Mirage, created by former Atlantic City casino executive Steven Wynn, became the first casino “destination resort,” with more than 3,000 hotel rooms and non-gaming attractions. Illusionists Siegfried & Roy opened their act at the Mirage with exotic white tigers and lions onstage and played there until an injury forced their retirement in October of 2003. While none of these competitors were on the East Coast—yet—they were a harbinger of the end of Atlantic City’s near monopoly.

In 1992 and 1993, table games and slot machines were added to a bingo hall founded by the Mashantucket Pequot Indian Reservation in central Connecticut; Foxwoods Resort Casino was now in competition for the East Coast market. Mohegan Sun was opened by the Mohegan Indians in 1996. Dover Downs in Delaware, a harness racetrack 130 miles southwest of Atlantic City, installed slot machines in 1995. Horse and greyhound tracks in Pennsylvania and New York followed suit, becoming “racinos,” a hybrid term of casinos and racetracks. Once table games such as blackjack were added to racinos, it further blurred the boundaries between a casino and a racetrack. In fact, the lines have become so blurred that beginning with the State of the States 2011 annual report, the American Gaming Association aggregates data from racetrack casinos and stand-alone casinos.

Not surprisingly, the growth of Atlantic City’s total casino revenue slowed in the 1990s relative to the growth observed throughout the 1980s. But it is important to remember that the new casinos elsewhere were frequently owned and/or developed by the same companies that operated in Atlantic City. So while the city was facing more competition, the industry itself was growing and consolidating. The nature of the owners was, in fact, changing as well. Once the profitability of casinos had been demonstrated, corporations in other leisure-focused industries moved in. Hotel chains such as Hilton bought gaming-oriented companies like Bally’s Entertainment. Wynn’s company, Mirage Resorts, was purchased by MGM Resorts International; it is now one of the dominant companies in the global gaming industry.[31] As competition increased, the casino industry increased its lobbying efforts to modify New Jersey’s stringent regulations. Since they were diverse companies with properties in multiple locations, they were well positioned to make demands on local policy makers. At minimum, they could threaten to divert resources and investment into their newer properties; at worse, they could threaten to exit the state altogether.

The impact on casino employment is clear. As figure 2.3 illustrates, the local industry began a secular (long-term) decline in employment in 1997, pausing only when a new casino, the Borgata, opened in 2003. Other factors contributing to this change—from the development of labor-saving technologies to work intensification—are discussed in later chapters. Loss of market share to other locales that offered the same slot machines and table games was critical, and only worsened in the new millennium. Looking at figure 2.3, we can see that the recession and slow recovery since 2007 deepened job losses, as casinos scrambled to cut costs. The opening of Revel in 2012 provided only a slight boost to employment numbers.

Atlantic City was literally built on sand. The city’s founders—innovators in the relatively new industry of middle-class tourism—laid down some planks on a stretch of beach real estate and encouraged visitors to come enjoy the ocean air. But the tourism industry also rested on a soft foundation, as travelers’ tastes and options evolved over time. By the 1970s, a new wave of innovators hatched a plan to bring back the tourists: casino gaming. Once again, Atlantic City pioneered a new kind of leisure activity. These trendsetters and their hard-working employees collaborated to make the party come to life. Despite some efforts of policy makers and activists to ensure that the city around the casinos shared in the prosperity, spillover effects were limited. The gamblers stayed inside the boxes built on the sand. The success of Atlantic City’s casinos attracted established corporations drawn to the industry’s profitability. Eventually, they adapted the model to other locations. As gamblers had more convenient alternatives to Atlantic City, local industry promoters and political leaders realized that they needed to differentiate their product and/or cut their operating costs. Their efforts to do this are detailed in what follows.


Nelson Johnson, Boardwalk Empire: The Birth, High Times, and Corruption of Atlantic City (Medford, NJ: Plexus, 2002), 34. Boardwalk Empire, and the HBO television series upon which it is based, highlight the days before legal gambling, with corruption in politics and organized crime.


Johnson, Boardwalk Empire, 21-22; Bryant Simon, Boardwalk of Dreams: Atlantic City and the Fate of Urban America (New York: Oxford University Press, 2004), chap. 3.


Simon, Boardwalk of Dreams, chap. 4.


For an overview and evaluation of various theories of Atlantic City’s decline, see Simon’s Boardwalk of Dreams, chap. 5.


Michael Pollock, “From Divestment to Reinvestment: Atlantic City Addresses Core Issues,” in Casino Gaming in Atlantic City: A Thirty Year Retrospective, 1978-2008, ed. Brian J. Tyrrell and Israel Posner (Margate, NJ: ComteQ, 2009), 13-21.


Jane Jacobs, The Death and Life of Great American Cities (New York: Vintage, 1961).


Larry Sawers and William K. Tabb, Sunbelt/Snowbelt: Urban Development and Regional Restructuring (New York: Oxford University Press, 1984).


Simon, Boardwalk of Dreams, 127.


George Sternlieb and James W. Hughes, The Atlantic City Gamble (Cambridge, MA: A Twentieth Century Fund Report from Harvard University Press, 1983), 81.


The image and reality of the industry in Nevada had been improved in the 1960s and 1970s by the entrance of mainstream businessmen like Howard Hughes and major hospitality and entertainment corporations such as Hilton, Hyatt, and MGM. See Denise von Herrmann, The Big Gamble: The Politics of Lottery and Casino Expansion (Westport, CT: Praeger, 2002), 12-13.


One of the prime architects of the pro-casino campaign, then-Assemblyman Steven Perskie, recently reminisced that their original intent was to confine gaming to Atlantic City, but they had to insert the local option to get enough votes in the State Senate to put the initiative on the ballot. Steven P. Perskie, “The Political and Economic Background of Atlantic City in the 1970s,” in Tyrrell and Posner, Casino Gaming in Atlantic City, 3.


Michael Pollock, Hostage to Fortune: Atlantic City and Casino Gambling (Princeton, NJ: Center for Analysis of Public Issues, 1987), 11. Pollock was a reporter for the Press of Atlantic City at the time of publication in 1987. He later went on to work for the Casino Control Commission and then became an industry consultant.


Ovid Demaris presents a skeptical view of the motives and connections of those promoting gaming that contrasts with other locally based writers. Ovid Demaris, The Boardwalk Jungle (Toronto: Bantam, 1986), 52-59.


Sternlieb and Hughes, Atlantic City Gamble, 81.


Sternlieb and Hughes, Atlantic City Gamble, 79.


Johnson, Boardwalk Empire, 221.


Other space requirements are detailed in Nick Casiello Jr., “The Adoption and Development of the Casino Control Act,” in Tyrrell and Posner, Casino Gaming in Atlantic City, 84-85.


Casiello, “Adoption and Development of the Casino Control Act,” 81-82; emphasis in original.


See John Froonjian, “Special Report: Coming to Atlantic City,” Press of Atlantic City, December 28, 29, and 30, 2003.


Pollock, Hostage to Fortune, 18-19.


This figure comes from Sternlieb and Hughes, Atlantic City Gamble, 10.


Oliver Cooke, “The Economic Impact of Gaming in Atlantic City,” in Tyrrell and Posner, Casino Gaming in Atlantic City, 135.


New Jersey Casino Control Commission, Casino Gambling in New Jersey: A Report to the National Gambling Impact Study Commission (Atlantic City: NJCCC, January 1998).


An often-quoted study was Michael Pollock’s book, Hostage to Fortune. Sternlieb and Hughes’s 1983 study for the Twentieth Century Fund, The Atlantic City Gamble, raised early concerns about the lack of spillover effects.


Sternlieb and Hughes, Atlantic City Gamble, 82-94.


Joseph Rubenstein, “Casino Gambling in Atlantic City: Issues of Development and Redevelopment,” Annals of the American Academy of Political and Social Science 474 (July 1984): 69.


Cooke, “Economic Impact of Gaming in Atlantic City,” 143.


David Listokin and Candice A. Valente, “Public Finance and Atlantic City Casinos,” in Tyrrell and Posner, Casino Gaming in Atlantic City, 89-133.


Harriet Newberger, with Anita Sands and John Wackes, Atlantic City: Past as Prologue (Philadelphia: Federal Reserve Bank of Philadelphia, 2009), 21.


Anthony Marino, “Transportation in Atlantic City,” in Tyrrell and Posner, Casino Gaming in Atlantic City, 45.


Datamonitor, Global Casinos & Gaming, reference code 0199-2019 (New York: Datamonitor USA, May 2011).

Caroline and Ruth’s Story

Caroline and Ruth have a very special, atypical, friendship. One is Irish Catholic. One is Jewish. They both fell in love with the same man, one and then the other, in different decades. All three have been casino employees. Caroline met and married Tommy first, but they eventually parted ways. When he later met Ruth on the job and they fell in love and married, Caroline decided there was no reason for drama. So they coparented Caroline’s children, sharing custody between the two households. Ruth and Tommy were happily married for over twenty years. Unfortunately, he died suddenly. Since Tommy’s passing, the two women have remained close friends, seeing each other at least weekly. In some ways, the bond is even stronger now, as there is only the two of them to look after each other and the now-grown kids.

We talk with each of them on different days in the tidy mid-twentieth-century bungalow where the recently widowed Ruth has been struggling with her loss. A short tour of her small home reveals creative use of space. Ruth swapped the dining room and living room in her open floor plan. This allows her to have bookshelves from floor to ceiling, lining two walls of the dining room, so it can double as a library and large workspace where she writes. We sit in the living room, which also served as a family room and den. Ruth says when the kids were young, they all slept in sleeping bags on the floor, while she supervised from her nearby bedroom.

Caroline is a longtime dealer, a “Day-Oner” at Resorts in 1978. While Ruth was not a Day-Oner, she too was employed at Resorts early on before transferring to another casino. Together, Caroline and Ruth have nearly six decades of experience in Atlantic City casinos. Ruth was a beverage server until her back and her feet refused to let her continue. Caroline soldiers on. Both unreservedly love their jobs in the casinos. They are apparently great at what they do.

Ruth’s path to becoming a cocktail server was circuitous. She grew up in the suburbs outside Philadelphia in a solidly middle-class family and taught school there after college. Unhappy in the classroom, she got a master’s degree but still wasn’t satisfied. As she puts it, “Now I know this sounds goofy because who, with two degrees at age thirty would, you know, decide to be a waitress.” But she thought it would be a stopgap job until she could “figure this out.” She lied about having waitressing experience to get her first job in Philadelphia, working from 10:00 at night to 2:00 in the morning. And she took to it, as she says, “like a duck to water.”

Her concerned parents initially thought she was crazy. After such an investment in her education, she was throwing her life away! But her father wound up being the one who suggested she work in the casinos. He loved to play blackjack at the newly opened Resorts. The family already had a vacation condo in one of the shore towns near Atlantic City, and he started slipping off to gamble. At the tables, he saw how much money the cocktail waitresses were making. Voicing her father’s advice, Ruth recalls, “As long as you’re going to be a waitress (the worst thing he could imagine), why don’t you at least move to Atlantic City?” She was shocked by the suggestion, mostly because of the revealing outfits the casino waitresses had to wear. It wasn’t how she was raised to look. But she adored her father and took his advice, heading down to the Local 54 union office for help in applying.

As it turned out, Ruth loved waitressing. She felt she had a knack for the job. Responding to the judgmental voices she still heard in her head after all these years, she is adamant that serving people didn’t make her feel “subservient” at all. She knew how to treat the customers and how to get tips, sharing some of her secrets: “I carried a lighter, I lit every cigarette, I clipped every cigar, I had little mints on my tray, do you know what I mean? I did this for other people. If I saw you were hungry, let me run down to the gift store, I’ll put down a pack of peanuts next to you. It came so naturally to me; it was like taking candy from a baby. It’s like I just knew what to do… . I never went and served a drink in front of a losing hand. I stood back and waited. If the guy was going to lose the hand, I’d come back in a second and serve somebody else first. It’s a matter of focusing, paying attention to what’s happening.” This is actually very skilled work when put this way, not rote, not machine-like, but rather custom work for each and every customer.

Being a dealer was also an unintentional career for Caroline. She used to keep the books for the family business and originally dreamed of becoming a CPA (certified public accountant). But she had to pitch in and support her family when her father had a heart attack after the business collapsed. She was the one who suggested dealer school to her parents, putting her plans for college aside. Decades later, Caroline is a seasoned dealer. Despite the oft-reported 20 percent or 25 percent turnover rate in the casino industry across the United States, she and many of her coworkers have stayed around and turned a job into a long career. Maybe they tried “dual rate” jobs for a while, to get a (dis)taste of lower-level management in the gaming pits. Maybe they switched casinos in town. But they’re still there.

Also like several women we interviewed, Caroline stepped away from her paid job for a few years when she had very young children. When she returned to the labor market, she was offered and accepted a job as a floorperson. She hated it! “I’m not meant to be a floorperson,” she asserts. Why, we ask? Hourly pay plus overtime, but no more tips. Not enough contact with people. Too much worrying about player ratings for comps, too much responsibility for supervising other dealers at gaming tables in the pits. “Instead of having my seven players, because you had four games you had to watch, now I had twenty-eight people that I had to comp, rate—boom—didn’t have time to talk and have fun.” After a few years, she went back to full-time dealing, though she would be asked repeatedly to consider flooring again.

Caroline deals baccarat, blackjack, all the carnival games, and roulette. She loves dealing tournaments, even taking a different or extra shift for a day to work them. And she is not afraid—in fact she relishes—being pulled off her regular games to handle the hundreds of thousands of dollars that pass through the casino with high rollers. Many dealers are intimidated by the high-action pits. Ruth, interjecting from the kitchen where she is having a cigarette, even comments to us about Caroline’s skill: “When you see these kind of mega bets, where she is good enough, dealer wise, not to make a mistake. Most of them are terrified of that. So that’s a huge asset; they can use her for the high-action pits.” Caroline shares her secret: simple division. For instance, once a whale (high roller) bet $10,000 in three-card poker and won a straight flush, 40-to-1 odds. The payout and bonus were huge. When the shift manager asked her how she was able to push the chips to the player so quickly, she said that she treated $50,000 as if it were $5 in her head. She broke down large sums of money simply by dividing.

Caroline has lots of whale stories. She reminisces about one who flew in regularly from out of town. The casino had set up a separate room for him with blackjack, roulette, and craps. And he got to pick his dealers. When whales like him come into the casino, dealers are allowed to “drop orange,” or put $1,000 chips into the tip box. The whale bet $60,000 on just two hands, and he did toss her an orange even though he lost. The player ordered a water and also gave the beverage server an orange chip. Paraphrasing one manager to us, Caroline mimics, “What are you doing? You lost. You tip too much.” It was as if they were saying, use and lose the money at the table; don’t share it with the staff. After a few other games with Caroline dealing, the whale threw her a gray chip (worth $5,000). She “cut it down,” gave him five orange for change. “I push it to him, he gets it, pushes it back, and says ‘that’s for you.’” Looking at the pit boss, he adds, “Don’t ever tell me how to spend my money.” Naturally, we ask Caroline how she feels about having to pool her tokes with other dealers rather than keeping her own (as the server who brought the water could do). Sometimes it bothers her, especially in situations like this, when the whale lost boatloads of money and dropped over $100,000 in tips to the dealers he selected to play with him.

While an orange chip tossed on a server’s tray is rare, an average senior beverage server delivering free drinks on the gaming floor could easily take home $500 per week in tips. Ruth was no average server. She worked extremely hard, explaining “And the only way to make money at the job is to go back and forth, back and forth even with one drink on the tray so you never miss a customer … for six hours straight.” In good years, Ruth was proud of her take-home pay. She maintained meticulous, “precise” in her words, records for tax purposes. The biggest tip she ever got was $3,000. She remembers it vividly: “He was playing blackjack and he was up a million dollars and he picked up, I saw him reach into his stack and put his hand on a group of chips, I had no idea how many, but when he picked them up, he took my hand and put them in my hand. I was literally shaking. I ran into the bathroom with a hand full of chips and they were all $500 chips, purple chips, and there were six of them. I ran upstairs, left the floor, and called my parents at 3:00 in the morning to tell them. I was like, ‘Oh my God!’” No wonder it was hard to walk away from these jobs to go back to college or begin college or look for something different. When the casinos were busy and business was thriving, dealers and servers could sustain a middle-class lifestyle and support a family.

We learn from Ruth and Caroline that for every generous whale there are multiple with bad reputations. Caroline has dealt to many of them. The worst offenders have been so drunk that they have turned their head, vomited on the casino floor, and turned back to keep playing. They have thrown cards at her face. They would call her names. Regular gamblers, too. They would get into fights. One fistfight was so bad that two blackjack tables got turned over. Each one weighs at least eighty pounds! Ruth has also served these more malicious gamblers. Cocktail servers are trained to cut customers off from alcohol if they are drunk. But who is going to cut off a high roller who gambles hundreds of thousands of dollars in a sitting?

Regrettably, too, for every player who comes to the casino for entertainment and who can afford to lose money, there are others who cannot. Gambling addiction is a serious problem. Ruth and Caroline have seen more than their fair share. Some are regulars. Others are not. Like a college student. Caroline sighs remembering a story: “Oh, it breaks your heart. Especially when you see the young kids that, you know, a young kid comes in on spring break a lot, and they’ll say ‘[Caroline], you gotta help me out, I’m down.’ And you know they don’t know me, they just look at my badge and they’ll be in on spring break. ‘This is all I got left; I spent all my money for the semester.’ I’ll say, ‘Why don’t you go home with that?’ and it’s like you pray that they win. The one guy lost, he had a bet up, and it was $100. He lost it because I flipped over like twenty winners. He put his hand on the bet and started crying.” They also tell us of suicides that don’t always make it into the local press. Some addicts feel there is no other way out.

With the repetitive motion of dealing night after night, Caroline developed severe pain in her hands. “Some days I’m hurtin’ so bad, I can’t shuffle the cards.” She doesn’t know whether it is carpal tunnel syndrome or arthritis. The pain forces her to take early outs, being tapped out of her game early to go home. Ruth, too, suffers from the ailments that come from working on your feet throughout a career. “What happens to your body is almost incomprehensible,” exclaims Ruth. “I mean constant pain, bordering on unbearable, where, on your days off, you want to lie in bed, where you don’t want to get out of bed.” She is a petite woman, and very agile on her feet. She estimates that a full cocktail tray weighs about fifteen pounds; she carried that tray over her head and served about 200 customers per shift, five shifts per week, for over twenty years. Naturally, Ruth discloses, a lot of the girls had foot and shoulder problems. If it weren’t for the pain, Ruth would still be swerving around the casino floor, serving tray after tray of drinks.

As business got worse, even before the Great Recession, and as her nagging pain for at least five years had become more magnified, Ruth quit—suddenly. “I was on my last legs,” she professed, “and I one day woke up, I called them up and I said, ‘I hate to do this to you after twenty-five years later, not to give you a two week notice, but when you saw me yesterday, that was my last day.’ I didn’t even tell my husband for two days. And he thought I was kidding when I told him. I said, ‘I quit.’ He said, ‘You can’t be serious!’ I said, ‘I’m telling you, I quit.’ He said, ‘Oh my God!’ I said I could not walk one more step. One more. I had lost it.”

Caroline and Ruth have mixed feelings about the current state of the industry. The decline in business and subsequent cutbacks have made it hard on the workers on the floor. They have not received an increase in their base pay in six or seven years. Declining business with competition from nearby Pennsylvania has meant declining tips. The double dose of competition and the recession have forced Caroline, Ruth, and other casino working families to curb their expenses. While families were once excited to have large numbers of their siblings and children join the industry, now there is more skepticism. One of Caroline and Ruth’s shared children is in the industry, in a relatively rare full-time job in the back of the house. Caroline’s sister is also in the industry. In general, though, they would not necessarily recommend that their children, nieces, and nephews seek employment in the casinos. Ruth explains why, especially the odd hours and the gambling culture: “Number 1: you are never going to have a normal life. You are going to be working every holiday, every evening. You are never going to be home to raise your kids. You are going to want to be there at night where the money is when you should be home with your teenage kids. The kind of person you meet, whereas I enjoyed them, most of these people if you get to know them, they are troubled people. They’ve got a gambling addiction… . And the drinking, no.” Ruth’s idiom to describe a typical casino was “a den of iniquity.” In retirement, she has turned to writing short stories about her experiences, trying to bring a sense of closure to everything she’s seen and been through.