Can Unions Save Atlantic City?

Since 2006, when Pennsylvania’s first casinos opened up—strategically positioned to cut into Atlantic City’s market—New Jersey's seaside party town has been collapsing.

Jake Blumgart

Photo of this beautiful Atlantic City casino via Wikimedia Commons

The sidewalk along Oriental Avenue is packed with chanting, cheering workers waving signs and grinning at one another as they pass in an unending loop beneath the tallest building in New Jersey: the bankrupt Revel casino.

“Everybody’s here!” one worker says in wonderment, after helloing a passing acquaintance. That’s a bit of an overstatement; in reality there are only a few hundred of Unite Here Local 54’s 11,000 members, and many of the marchers work in Revel, which is the only nonunion casino on the strip. Now that the towering casino-hotel complex is bankrupt, and buyers are circling, the union is trying to get a foothold here too.

Not that these jobs are all that great. As Revel’s fortunes have failed, there have been thousands of layoffs, and everyone has been reduced to part time, with no benefits and no raises. That’s nothing like the employment standard Atlantic City maintained for the past three decades, a weird corner of the post-1970s world where working-class people could earn middle-class incomes in an increasingly low-paid service-sector economy. But now, as casino gambling spreads across the Eastern Seaboard, Atlantic City’s casino market is contracting, and workers' privileges are diminishing.

“I was able to buy a home in Ventnor [a town downbeach from Atlantic City], raise three sons—all of them went to college—we lived the good life,” says Eve Davis, who has been a cocktail server at the Showboat for 27 years and worked in the casinos for 31 years total. “We had a fabulous boom, and now we have the downturn. They have taken everything they can and left people desperate for jobs. I’m worried that I’ll still be able to maintain.”

Since 2006, when Pennsylvania’s first casinos opened up—strategically positioned to cut into Atlantic City’s market—the industry’s revenue has been falling every year, and the jobs along with it. In the peak years of the 1990s, 50,000 people were employed in the casino-hotel complexes. Now the number is 30,302 after the closure of the Atlantic Club, where 1,600 jobs were lost. Asked if she thinks more casinos will close, Davis says, “I think that’s definitely going to happen.”

The long winding line of casino workers can be heard from a few blocks away, periodic chants punctuated by noisemakers and shrill whistles: “Tell the whole darn world this is union territory!”

That isn’t an overstatement. For as long as casinos have dominated the city, Local 54 and other, smaller unions have represented the vast majority of the industry: Hotel cleaners, barbacks, cocktail servers, cooks, waiters, blackjack dealers (who are actually represented by the United Auto Workers). All of them have been well paid and enjoy rights at work that most Americans lack.

In the early years after the casinos began opening up, the Mafia used Local 54 as a wedge into the industry—a relatively unregulated corner of an island gambling mecca that was created with a raft of provisions to keep wise guys out. In the 1980s, vicious mobsters like Nicky Scarfo and Phil Leonetti had “a seemingly limitless skim from Local 54… which [they] treated like their own petty cash fund,” collecting (as in stealing) between $50,000 and $100,000 in cash from their cronies every month.

“I got word that the president of one of the casinos wasn’t going to sign a union contract with Local 54,” Leonetti recalls in his memoir, Mafia Prince (he eventually became a government witness and testified against his fellow gangsters). “I sent word to the president of the casino that if he didn’t sign the contract that I personally would blow his brains out of his head. He signed the contract the next day.”

But that era is long over. In 1990, Leonetti fingered the mob-affiliated staffers of Local 54 in a court-ordered takeover, cleansing it of criminal influence. Now the union is led by Bob McDevitt, who worked as a barback , and who has been president since 1996. The union is now known for an active membership that joins pickets and, occasionally, strikes (the last in 2004), when in disputes with the companies.

Today the union is largely composed of Hispanics and other recent immigrants from South Asia, Vietnam, and Africa. Atlantic City is home to the most diverse census tract in all of New Jersey (the whitest is farther down the island, in Margate). It isn’t just foreign migrants who come looking for good jobs: Davis has a lot of friends who commute from across South Jersey, a tourism-dominated region where some counties have full employment in the summertime and desperate unemployment in the winter. Atlantic City was a bastion of good year-round jobs and supplied a steady stream of major construction projects for the building trades like new hotels, casinos, and parking garages.

Most of the people who have made their living in Atlantic City do not choose to live there. Some neighborhoods have been largely untouched by the casino boom, like the majority African American Back Maryland, and crime and poverty are unusually high. When the gaming monopoly still existed, though, the industry didn’t care how shabby the surrounding city became. Dilapidation and disinvestment were arguably in the companies’ interest: Local restaurants, movie theaters, and nightclubs outside the casinos would potentially lure customers out of eyeshot of the slot machines.

“In 1978 [the year the first casino opened] there were 311 taverns and restaurants in Atlantic City,” a witness told the National Gambling Impact Study Commission in 1999. “Nineteen years later, only 66 remained, despite the promise that gaming would be good for the city’s own.” In its heyday celebrities regularly flocked to premieres in Atlantic City’s ornate movie palaces. The last one was shuttered in 1983, and now the only theaters are inside the casinos.

When casino companies come calling in a new town, they promise jobs, tax revenue, and economic development. The latter is belied by the shabby state of Atlantic City, but it is undeniable that here and in Las Vegas a multitude of good jobs were created: In Rick Fantasia and Kim Voss’s book Hard Work, they note that “the housekeeping staffs at unionized Las Vegas hotels are paid double what maids earn at nonunion hotels in other cities. Las Vegas is now the American city where low-end service workers are paid enough to own their own homes.”

It’s not like these companies are doing this out of the kindness of their own hearts. In Las Vegas, Local 226 had to fight hard for the wins Fantasia and Voss describe. Throughout the 1980s and 1990s, labor strife wracked Las Vegas, including the longest strike in postwar American history. And both Las Vegas and Atlantic City are concentrated markets that enjoyed, respectively, massive cultural cachet and a monopoly on casino gambling in the Northeast corridor. Both cities drew in tourists from outside the local area and didn’t simply prey on locals, so the net economic benefit for the region was positive.

“The way gambling companies market themselves as they come into new communities [is that] they like to talk about the successes, how their new casino towns are going to be resorts,” says Sam Skolnik, author of High Stakes: The Rising Cost of America's Gambling Addiction.“ [That’s] almost never the case... Inevitably some new jobs are created but they become more a drag on the local community socially and economically.”

The casinos that are mushrooming across the nation today do not have the ability to pull in outside money, and most are not union. Of the 12 casinos in Pennsylvania, now the second largest casino market in the nation outside Nevada, only three are unionized. An organizing campaign at Philadelphia’s Sugarhouse casino has stretched on for years, and the company continues to resist with the help of an extremely conservative antiunion firm. Workers report that health care is unaffordable, wages low, managerial relations troubled, and turnover high.  The latter is true across the state: A 2008 Pennsylvania Gaming Control Board report found that the voluntary, non-firing, turnover rate across the state’s casinos ranged between 24 and 66 percent, well above normal. (Subsequent reports have not taken up the issue.)

That’s why Local 54 is keeping the pressure on Revel’s owners. If it remains nonunion, it will be able to offer the same kind of low-pay, no-benefits jobs it does now, which could be a tempting model for other owners. In the coming years more casinos will close—Trump Plaza has been doing very badly for a very long time—but this mega casino, the newest on the strip, will presumably not be one of them. If Local 54 wins, at least a few thousand more workers would still enjoy union protections and wages.

“When I was young there were more jobs, way more tourists—not so much now,” says Liditze Diaz, who is pushing her stroller along the picket line. She’s been a server at Revel for almost a year. “I’m raising my kid and supporting my father because he is older and it is harder for him to get a job. I had summer jobs before, nothing serious. This is my first casino job; this time it’s a job I do need to maintain for myself and my family. Both my parents worked [in the industry], and they raised me off of casino jobs. The main difference [between their jobs and her position at Revel] is the job security. Every job my parents had was union.”