The famous Atlantic City casinos are closing, which means thousands of Atlantic City residents are finding themselves unexpectedly unemployed. The casinos have been struggling for years, but stiff competition from Las Vegas and casinos in surrounding states have simply overwhelmed the boardwalk. Four casinos have closed already in 2014. As of September 2014, Atlantic City has one of the
highest unemployment rates in the nation: 13.8%. How can casino workers survive this crash?
Who is affected?
So far this year, four casinos have closed: the Atlantic Club, Showboat, Revel, and Trump Plaza. That's a third of the casinos in town. The Taj Mahal, another Trump casino, is expected to close before the end of the year; it
filed for bankruptcy in September. The casinos are struggling to pull in customers as neighboring states legalize gambling.
Casinos in Atlantic City employed more than
30,000 people as of 2011. The casinos employ Atlantic City residents in a wide variety of positions. Those jobs include dealers, hotel workers, maintenance staff, security guards, and the managerial staff necessary to run such large operations. In addition, casino traffic supports the restaurants, shops, and attractions in the surrounding areas. Without casinos to draw in tourists, boardwalk shops and the famous Steel Pier may not be able to survive, either. The casino closure problem affects everyone in Atlantic City.
What You Can Do Now
No matter where you work in Atlantic City, it’s a smart idea to start saving up cash. Casino workers are the most directly affected, since their jobs are at risk from the start. Employees of nearby restaurants and stores, however, should also be saving up. If you lose your job, you’ll want to have a reserve of cash to fall back on while you go through the process of filing for unemployment and finding a new position.
If you’ve already been laid off, you should take a very careful look at your budget. Cut out the things that aren’t absolutely necessary. Perhaps you can cut out cable TV for a few months until you get back on your feet. Maybe you can cook at home more and eat out less. Use coupons for the things you need at grocery and drug stores - you'll be surprised at how much you can save. Managing your expenses carefully can help you stay in the black while you look for a new job.
Many casino workers are specialized – dealers and hotel workers won’t have an easy time finding new jobs. The remaining casinos are struggling just like the ones that have closed, so they probably won’t be hiring. If your job is unique to the casino industry, you might want to start considering your options for other types of employment. Update your resume and keep an eye on the types of jobs that are available near you.
If you’ve already been laid off, you’ll want to start applying to new positions right away. The average
duration of unemployment in the US right now is almost 32 weeks – that’s eight months. The sooner you start applying, the sooner you’ll be able to find a position.
Meeting Your Expenses While You’re Unemployed
A lot of the recent layoffs in Atlantic City were sudden – those people didn’t have time to prepare for unemployment. Even if you have some warning, it’s tough to save up enough to cover all your expenses for the months it takes to find a new job. If you're laid off in a casino closure, you should file for unemployment right away. That way, you'll have some cash coming in while you look for another position. Filing for unemployment can be somewhat complex and difficult, so pay careful attention to the requirements and paperwork in order to avoid delays in receiving payment.
Your unemployment payments may not be enough. New Jersey isn't a cheap place to live, after all. Sometimes, you have no other option but to borrow to cover what you need. You may be able to obtain a bank loan, which will carry a market interest rate. If you own a home, you may be able to refinance your mortgage and get a lower rate, lowering your monthly payments and freeing up some cash. You may also be able to take out a home equity line of credit to give you the cash you need while you look for a new job. You may also be able to get financial help from family and friends; they tend to be a lot more understanding than institutional creditors.
You may choose to use credit cards to cover your costs, but remember that they may carry interest rates as high as 29%. With rates like that, the debt can get out of control very quickly.
Consider selling off assets that you don't need. A second car may be important to you, but carpooling may be worth the hassle if you get the cash you need to pay your bills.
No matter how dire your financial straits, do not take out a payday loan.
Payday lending is illegal in New Jersey, so you would only be able to take a payday loan online. Many of those online payday loan services are scams – they’ll take your fees and disappear, leaving you worse off than before.
Managing Debt in Unemployment
You may have to worry about a mortgage payment, a car payment, and all the other expenses associated with every day life. How can you keep up without a job? The answer in many cases is that you can’t. You’ll have to borrow to pay your bills and you won’t be able to make payments on the debts that you already have. It may seem like you have no choice but to fall deeper and deeper into debt. You'll have to face
debt collectors and all the stress and anxiety they bring with them. That road leads to
repossessions,
foreclosure,
collection suits,
wage garnishment, and other terrible consequences.
Even though the situation seems unmanageable, remember that you do have options. Contact your creditors and let them know what’s going on. They may be willing to work with you and forgive part of your debt or lower your interest rates to make payments more manageable while you’re dealing with hard times. They may be willing to accept a one-time lump-sum
settlement of less than the amount due as full payment. You may be able to consolidate your debts, which can lower your monthly payments. If you’re considering debt consolidation, be careful of debt consolidation scams.
All that may not be enough, but you still have options. This situation is why the
bankruptcy laws exist. They’re there to protect you from your creditors and help you get a fresh start when you get hit with a catastrophe such as losing your job. Bankruptcy will allow you to shake off your unsecured debts and wipe your financial slate clean. It will stop any collection lawsuits, wage garnishment, repossessions, and foreclosures.
In
Chapter 13 bankruptcy, you won't have to give up any property and you'll slowly pay off your debts over three to five years. Your payments will depend on your income, not on your debt. That means your payments will be manageable. At the end of the payment plan, your remaining unsecured debt will be eliminated. In
Chapter 7, you'll basically eliminate your unsecured debts. Most debtors have no non-exempt property and don't have to give up any property. Not everyone qualifies for Chapter 7 bankruptcy; your income must be low enough that you can't make meaningful payments to your creditors. In order to qualify for Chapter 7 bankruptcy in New Jersey, your average income over the last six months must be less than the New Jersey median income for a family the same size as yours.
The good news is that New Jersey has the second highest median income in the country, making it much easier to qualify. Median income for a single person is $61,200. Median income for a family of four is $105,469. That means the median monthly income for a single person is $5,100. The median monthly income for a family of four is $8,790. You can see median income information for other family sizes
here. If you earned less than than the state median income over the past six months, on average, then you qualify for Chapter 7 automatically. If you earn more than that, you may still be able to qualify under the Means Test. Under the Means Test, the bankruptcy court will analyze your income and expenses based on state and national standards to determine if you would be able to make meaningful payments to creditors through a Chapter 13 payment plan. If so, you'll be required to filed under Chapter 13. If not, you'll be able to file under Chapter 7.
If you're struggling with debt, contact an experienced bankruptcy attorney for a free consultation to learn about what options best suit your needs and goals.
Don't Wait
The most important thing is to be proactive. If you’re working in Atlantic City, prepare for the worst – even if you don’t lose your job, it’s nice to have some money put away for emergencies. If not, start taking steps now to find a new position and deal with your debt.
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