Lockdown’s Severe Impact on Hospitality and Gambling Sector

Coronavirus pandemic lockdown has severely impacted the hospitality sector and casino clubs are no exception.

One of the employees of SkyCity casino Zoltan Buday found out that he was laid off from 6 pm news. Zoltan was working with SkyCity as a dealer. The casino was cutting 200 jobs and is planning to lay off another 700 in the future.

“It was during level 4 lockdown and I was holed up at home,” Buday said. “It was gutting.”

Zoltan was working with SkyCity for 8 years and is now jobless. He is looking for a job in the hospitality sector but the chances are slim as it is one of the worst-hit sectors by the pandemic.

“I just don’t know what’s around the corner,” he said.

Zoltan has applied for COVID-19 Income Relief Payment which is $490 a week. This relief can only cover his rent. He has two dependent children to take care of. Although he received a redundancy payment, the majority of it was deducted in tax.

Zoltan who is also a Unite Union Delegate had urged SkyCity on numerous occasions to apply for an extension to the wage subsidy. This would have helped the casino to retain the staff for some more time.

SkyCity eventually applied for the eight-week extension but it was after Zoltan was laid off.

In the coming week, it is estimated that people opting for COVID unemployment relief will reach 65,000 surpassing the Global Financial Crisis levels.

“There is a steadily rising second wave of job losses which are filtering through the economy,” said Brad Olsen, a senior economist at Infometrics.

The rate of job losses was slower than estimated thanks to the cautious optimism in the economy and wage subsidy provided by the government.

“We expected that as the main wage subsidy ended, there would be many businesses who went back to work, but downsized their workforce to meet the softer economic conditions we find ourselves in. We also expected that there would be many businesses that didn’t meet the 40 percent revenue decline threshold but were still grappling with a hit to revenues that would see them lay off workers.”

Olsen further stated that the job loss happened much slower than it was feared by the public because of the wage subsidy extension.

It was estimated that there would be 232,000 people who would need unemployment benefit by the end of June but the actual figure was 205,278 people who were on the two jobless support payments in the first week of July.

However, there is a fear that the jobless numbers will rise when the subsidy ends in September. It is currently supporting 372,000 jobs.

Welfare advocates are accusing the government of creating a two-tier welfare system as the newly jobless people are paid $490 under COVID relief payment while the existing jobless people are paid just $250 a week.

Social Development Minister Carmel Sepuloni in an official document has asked officials for suggestions on “option around general income adequacy of the income support system”

When asked for further information, Sepuloni said: “I have never shied away from the fact that we have more to do in the long term to address income adequacy.”