Researchers say the sports wagering industry is estimated to support over 10,000 jobs in the U.S. How diverse that workforce is in Massachusetts, only a few years after sports betting was legalized in the state, is the subject of a new study.
As casino gambling arrived in Massachusetts a decade ago, so to did state edicts to study their impacts, as well as efforts to foster a diverse workforce, among other elements.
All three of the state’s casinos had various diversity goals – both in terms of their workforce and the vendors they work with - the subject of a major workforce study last year – one that found such goals were generally being hit with some exceptions.
Now, a new study is out – looking specifically at the state’s sports betting industry and how diverse its workforce is.
“…the small size of the sports wagering industry in Massachusetts limits the number of diversity initiatives and policies at both the employee and vendor level,” says by Dr. Mark Melnik - Director of Economic and Public Policy Research at the UMass Donahue Institute. “Popular perceptions of the industry tend to skew towards younger segments of the population, in white males … some of the observations from folks in interviews theorize that this was harming recruitment and retention for diverse employees.”
Melnik went before the Massachusetts Gaming Commission Tuesday to discuss “Diversity in Sports Wagering and Recommendations for Future Practices in the Massachusetts Industry.”
Released in May, the study was called for when the state legalized sports betting in 2022, giving rise to casinos hosting in-person, retail sportsbooks.
A few years later, a team of UMass Donahue Institute and Gemini Research personnel found it’s a sector that, at the very least, has programming in place to try and foster a diverse workforce.
“Basically all operators have programs and policies in place to some extent,” Melnik reported. “None of them are particularly notable or have standardized metrics or targets, though. On programs and policy - all license holders and the MGC have programs, policies and practices in place related to solicitation of and contracting with minority, women and veteran-owned enterprises. Retail sports operators and the MGC universally have programs and policies to increase levels of engagement, volume and scale with these businesses as do nearly all mobile sports wagering operators.”
As Melnik and others noted, the retail sportsbook sector is a tiny one. Researchers believe that, in any given quarter of 2023, 51 people were employed by it – 30 percent of whom identify with “racial minority groups, while 1.5 percent are veterans, and 27.2 percent identify as women.”
The study also looked into vendor diversity – how many certified women, veteran and minority business enterprises sportsbook retailers contracted with, businesses “at least 51 percent owned, operated and controlled by one or more individuals” from said groups, the study explains.
Melnik says the industry’s small size, paired with the difficulties of vendors earning diversity certifications in the first place, leads to little opportunity for contracting with a diverse vendor – resulting in virtually no such deals involving retail sportsbooks.
“Operators spend relatively little on outside vendors and usually contract with only a few supplier providing specialized products,” he said. “Thus, there are few opportunities and not a large pool of businesses for them to diversify their purchases. Few of these vendors are based in Massachusetts, and only some are certified as diverse businesses.”
The study also looked at the sector’s digital peer - online/mobile sports betting operators. According to the study, Massachusetts is home to just over a tenth of the nation’s 10,265 workers employed in the industry, including Boston hosting the headquarters of DraftKings.
This, even though few employees “are involved in running operations specific to Massachusetts,” the study notes.
Researchers also point out that, compared to the in-person, sportsbook workforce it looked at, the other group is more in line with the tech industry than retail, working on “digital products, services, and platforms to engage patrons in online and mobile sportsbooks.”
It’s a sector that’s more likely to contract with minority and women business enterprises (MBEs and WBEs). On average, of 103 vendors worked with on a quarterly basis, 4.1 percent were MBEs and .7 percent were WBEs. It’s also more flush with cash – of $28.7 million spent during that time on said 103 vendors, $3.6 million went to MBEs and $9,124 to WBEs. Looking at the same quarterly timeframe, the study cited only $123,545 in spending involving retail sportsbooks.
Yet, researchers found in terms of a diverse workforce – there’s work to do. 17 percent of mobile workers identify with racial minority groups while 24 percent identify as women – lower than national averages.
“Of all U.S. employees, about 36.1 percent of the workforce is made up of workers who identify with racial minority groups … and 28.3 percent identify as women,” the study found. The trend also carried over to the slim veteran workforce numbers - .6 percent in Mass. vs. .9 percent nationally.
The full study can be found here.
