(STL.News) Around the globe sports betting is a multi-billion-dollar industry that provides jobs and huge boosts to both local and national economies. Here in the United States the industry is on the verge of lifting off as more and more States move toward widespread legalization.
The first legal sports bet in Illinois was placed on March 9, 2020 after Governor J.B. Pritzker signed legislation permitting sports betting in the State. Pritzker’s signature made Illinois one of just a handful of US States where citizens could place wagers from the comfort of their own homes or in regulated sports betting premises.
One of the main arguments in support of sports betting legalization has always been the industry’s economical impact. In this article we will put that assertion under the spotlight in a bid to find out the truth before concluding whether or not a legalized sports betting industry in Illinois is a good, or a bad thing for the State.
Sports Betting: The Facts
- According to industry statistics 1.6 billion people bet on sports in any given year with 4.2 billion people admitting to having bet on sports at one time or another.
- Australia and the UK are home to the most active sports betting fans in the world with 65% of Brits having wagered on sports at least once in their lives.
- In 2019, less than one year after the Supreme Court’s decision to strike down a federal ban on sports betting the industry generated revenues of $908.9 million.
- If every State in the country were to legalize sports betting, it is estimated that it would provide a $41.2 billion boost to economic output and provide both directly and indirectly 216,671 jobs.
The Economic Arguments Against Sports Betting
It takes money out of the local economy… Critics of sports betting regularly claim that any economic advantages of legalization would be negated by money leaving the local area or the country. This argument is based on the current landscape of sports betting.
Just because it is illegal to wager on sports in certain States that doesn’t mean that people don’t still do it. Foreign companies, particularly those based in the UK, run odds-on all-American sports and promote their services to sports fans throughout the US.
This does act to drain money directly out of the US economy, with lucrative tax dollars going straight across the Atlantic and into British coffers. Legalization however would allow homegrown American companies to satiate the sports betting needs of Americans, actually putting a stop to the millions of dollars leaving the country through online sports betting.
Sports betting is the domain of organized crime… Another argument that does the rounds amongst the anti-legalization brigade is the idea that sports betting is the domain of organized crime. If the act were to be legalized, opponents argue that organized criminal gangs would rule the roost and dominate the market.
Again, this is another misnomer. Sports betting prohibition is more likely to encourage the involvement or organized crime rather than deter it. As the US found out a century ago, prohibitive bans from government tend to create a void that organized crime will all too happily step in and fill.
Legalization will make people poorer… Another concern that many have is that legalization will lead to a tsunami of problem gamblers, frittering away their savings and destroying the local economy. To counter this, all that is needed is a cursory glance at Australia and the UK.
In the former there is a wide belief – backed up by the stats – that Australians are more prone to problem gambling than any other nationality. Yet the average monthly losses of an Australian who gambles for at least an hour a day is just $60 a month – half as much as the average American spends on coffee each month.
In the UK, in order to combat the impacts of problem gambling, all licensed gambling companies are obliged to contribute 1% of their total annual revenues to charities dedicated to helping those with gambling issues.
The example from those two countries is that firstly, problem gambling isn’t nearly as pernicious and widespread as many believe and secondly, that steps can be taken to ensure that the industry itself contributes to combating problem gambling.
The Economic Arguments For Sports Betting
Many of the arguments against the legalization of sports betting are anecdotal or at best, based on whataboutery. The best arguments to counter these concerns are based on facts and statistics, so we’ll keep this short, here’s why sports betting is beneficial to the economy:
- Legal sports betting is forecast to contribute $22.4 billion to the US gross domestic product.
- This will be felt on an individual level by the creation of an extra 216,671 jobs around the country.
- Including wages, benefits and tips legal sports betting would support $11 billion in total labor income.
- Tax coffers across the country would receive a $8.4 billion impetus from a legalized sports betting industry.
In summary the economic benefits of a legalized sports betting industry are clear to see. Whilst there may be some teething problems in the early stages of legalization, there has been a clear path laid by countries such as Australia and the UK.
With these blueprints for success and a modern, innovative approach it is hard to see sports betting not being a major success here in the US.