Fact-Checking Casino TV Ads: Will Issue 3 Create 34,000 Jobs?

COLUMBUS, Ohio -- Television advertisements supporting the Issue 3 plan to build four new casinos in Ohio promise the creation of 34,000 new jobs. Is it an exaggeration, or is it accurate?

NBC 4's Patrick Preston investigates the facts behind the advertisement's claim.

Issue 3 supporters are blanketing the airwaves with advertisements highlighting the 34,000 job estimate, including an ad featuring Fraternal Order of Police Vice President Scott Tipton making the claim.

"Issue 3 will create 19,000 construction jobs and 15,000 permanent jobs. That's 34,000 new jobs for Ohioans," Tipton states in the ad from the Ohio Jobs and Growth Committee.

The source of the jobs estimate is a June 2009 report by two staff members at the University of Cincinnati Economics Center for Education and Research. The Ohio Jobs and Growth Committee paid for the report's production, which uses a federal government job creation formula to estimate how many jobs the four casinos would bring to Ohio.

Jeff Rexhausen served as project director on the report and told NBC 4 that the formula makes no distinction between part-time and full-time jobs. The result is a jobs estimate that does not distinguish between casino jobs that provide employees with 40 hours of work each week, or jobs that provide only 15 hours of weekly work.

The report also credits Issue 3 with the indirect creation of 17,000 jobs.

Of the 19,000 temporary construction jobs lasting a maximum of two years, only 9,700 workers would build the four casinos, an average of 2,425 construction jobs per city. The remaining constructions jobs are calculated from companies doing business with the casinos.

The same principle applies to the 15,000 permanent jobs touted in the television ad. The University of Cincinnati report states that only 7,500 permanent jobs directly relate to the casinos. The remainder are indirect jobs from other companies. What does that mean?

If contractors buy building materials from companies in Dayton or Pittsburgh, the report credits the casino with the creation of some of those companies' jobs. And in the case of contracts with out-of-state companies, the formula still credits the casinos with job creation.

Issue 3 spokesperson Bob Tennenbaum said that situation is hypothetical, noting that the figures provided by the University of Cincinnati report are merely estimates.

Organizers of the Issue 3 campaign did not take credit for jobs related to the manufacturing of slot machines in Nevada and other states, nor did they credit the casinos with jobs created by the payment of licensing fees or gaming tax revenues to the state of Ohio.

According to the report, "most full-time casino employees will make less than $30,000 a year." NBC 4 found that 86 percent of the casino jobs listed in the report have average salaries of less than $28,000, including income from customer tips.

Casino operations managers, general managers and business managers will average $82,000. Those jobs constitute just 2 percent of the total casino workforce and are the only jobs with average salaries above $48,500.

The report points out that "few of the jobs anticipated at each location will require a post-secondary degree, or advanced skills or experience," and goes on to note that "casino jobs provide a means of moving individuals from welfare to work."

More than half of the 7,500 casino jobs fall into three categories which average less than $23,000 a year in pay.
-22% of casino jobs: Food preparation and service workers. Average salary: $19,500.
-20% of casino jobs: Gaming dealers and slot key persons. Average salary: $21,700.
-14% of casino jobs: Machine servicers, cashiers and other gaming service workers. Average salary: $22,900.

Unemployed workers stand to benefit from the income opportunity, but compared to the city of Columbus' median household income of $42,253, the jobs will be less valuable for generating income tax revenue for the city.

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