GOOD NEWS/BAD NEWS FOR THE AMERICAN HORSE RACING ENTERPRISE

Two front-page stories in newspapers today depict current economic conditions in the United States that give horse owners, trainers, farm managers, and racing-related businesses cause to be both grateful and concerned.  It is truly a good-news, bad-news narrative that will make for a “business is great but we can’t find enough employees” summer and fall 2018 and likely beyond.

Wall Street Journal headline reads: “U. S. Has More Jobs than Jobless.”  Excerpts from the accompanying article are as follows:  “For the first time since such recordkeeping began in 2000, the number of available positions exceeded the number of job seekers, the Labor department said Tuesday, a shift that is rippling across the economy and affecting the behavior of employers and workers…The unemployment rate ticked down further in May to a seasonally adjusted 3.8%…the last time the rate was lower was in 1969, when young men were being drafted into the Vietnam War.”

Another article–in The Plain Dealer–had a headline “NE Ohio in Federal Crackdown” and reported on a raid by ICE at a garden center that resulted in the arrest of 114 employees who are allegedly in the country illegally.  An ICE official said that the garden center’s owners have not been charged but “potential crimes include harboring and unlawful employment.”

On the one hand, an economy working in all cylinders with full-employment is a boon to entertainment businesses like horse racing that depend on disposable personal income, as reflected in record betting on the 2018 Triple Crown races and an overall improvement in pari-mutuel handle.  On the other hand, finding enough legally-authorized workers to fill the low-paid and physically demanding jobs at racetracks and farms is increasingly a challenging.

The other piece of good news/bad news for the American racing industry is that African-American and Hispanic unemployment statistics are at record-low levels.  While this is a welcome development, it creates problems for horse-racing employers, who rely so much on a workforce staffed by Hispanics.

It is likely that some people who have not been seeking work will now do so and thus alleviate the labor shortage.  However, it is unlikely that they will find appealing physically demanding and low paying jobs with long hours in stables and farms.

What percentage of workers employed on the backsides of racetracks and on farms are illegally in the United States is unknown.  However, it is a safe bet that the percentage is not inconsequential.  With public opinion polls showing that the American people are supportive of tougher immigration measures by the federal government, it is unlikely that a sufficient number of temporary work visas for low-paid jobs will be issued.

Horse-racing businesses will have to be creative in hiring, be more efficient with fewer employees, and raise wages and offer improved benefits and working conditions.  The not-recommended alternative is to hire illegals and run the risk of the public-relations fallout and possible prosecution.

Copyright © 2018 Horse Racing Business

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