Is it the sports betting???

Young men are gambling more. But there’s more to the story than just sports betting.

Wagering, such as sports and racing betting, is on the rise for young men. At the same time, problem gambling has risen, driven almost entirely by young men. Are these two linked??

According to the Household, Income and Labour Dynamics in Australia (HILDA) survey, over 3% of young men now meet the criteria for problem gambling up from around 1.5% in 2015. This is based on the internationally recognized Problem Gambling Severity Index (PGSI), which captures how gambling impacts behaviour and relationships.???

Community and policy discourse suggests that the rise in gambling among young men is directly tied to the increase in gambling advertising and the accessibility of betting apps. The argument feels almost self-evident: young men are inundated with ads during every sporting event, encouraged to gamble socially with their friends, all from the convenience of their smartphones. This narrative has driven calls for stricter advertising bans and tighter regulation of betting firms.?

This explanation seems convincing and is undoubtedly somewhat true. But there are anomalies in the data that suggest that while gambling advertising and accessibility are likely contributors, they don’t tell the whole story. There are broader trends and patterns at play that warrant deeper investigation.?

First, the rise in sports betting appears to be getting more young men to gamble a little rather than a lot. About 5% more young men now bet each month, but most of this increase comes from those spending under $20. Meanwhile, there’s been no real change in the share of young men reporting higher spending (e.g., over $50 a month). There’s also a small uptick in low-level participation in other forms of gambling, such as pokies.

Second—and paradoxically—while gambling has increased among young men overall, problem gamblers are gambling less. More are also reporting no gambling in a typical month despite reporting behaviour that meets the criteria for being a problem gambler over the past year, suggesting that more irregular gamblers are identifying problematic habits.??

This could reflect a compositional shift: as gambling becomes a more prominent topic of discussion, people might be now viewing smaller gambling habits as problematic.??

The PGSI question “Have you felt that you might have a problem with gambling?” shows a rising share of people agreeing, even though the average amount gambled by those who agree has declined. For instance, in 2015, around 1% of young men who spent $50 a month or less on gambling said they at least “sometimes” felt they had a problem; but in 2022 this had risen to over 4% (adjusting this threshold for inflation). Perhaps greater cultural awareness now places the threshold for concern at $20 a month, rather than $50.?

There is an alternative explanation: individuals may be more likely to underreport their losses than a decade ago. But this seems intuitively unconvincing: why would men be becoming more likely to admit they have a problem, yet less likely to admit how much they’re spending??

Third, pokies—not sports betting—remain, by a wide margin, the dominant mode of gambling among problem gamblers, including young men. While sports betting has grown, those who gamble the most heavily continue to favour playing at the pokies. Pokies are also far stronger predictors of problem gambling both according to regression analysis using HILDA, and other survey evidence.??

Fourth, there seems to be some underlying behaviour or cultural shift going on even outside of gambling: young men seem to be embracing more financial risk-taking generally. Since the pandemic, the share of young men willing to take above-average risks with their spare cash has grown from 14% to 18%. This may reflect a cultural trend toward greater risk appetite for young men. Gambling advertising—and, for instance, the rise of cryptocurrency marketing—may be amplifying this shift, or may just be taking advantage of it.?

So, what can we take away from this???

While the rise of sports betting appears to be influencing young men’s gambling, the data shows there’s more here at play: problem gambling still largely is driven by the pokies, much like a decade ago. And, if deeper social or cultural factors are driving young men to bet, policies such as banning sports betting advertising may be treating the symptoms, not the root cause.?

Future e61 research will dig deeper into these trends, drawing on multiple data sources to better understand how gambling and risk-taking behaviours among young men have evolved over the past few years. With an understanding of what’s driving these trends, policymakers will be able to better target solutions to help those most adversely affected by gambling. ?

by Matthew Maltman

Matthew Maltman is a Research Economist at the e61 institute.

He previously worked at the Australian Productivity Commission, where he focused on various policy issues including education, public transport, and housing policy. He is passionate about housing affordability and writes on the impact of housing supply reforms globally.

Matt holds a degree in Economics from the University of Western Australia, where he graduated with First Class Honours.

For more information, please reach out to Matthew via email at [email protected]

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