After much speculation and more than a few claims otherwise, Foxwoods Resort Casino has officially announced plans to lay off 700 workers - or about 6 percent of its work force -  citing a drop in gambling and the weakening U.S. economy as reasons.

The 340,000-square foot casino in Connecticut is owned and operated by the Mashantucket Pequot Indian tribe and is the biggest player in the thriving Native American gaming industry, boasting more than $27 billion nationwide in gross revenues in 2007. It is also the largest casino in North America.

"As is happening to so many organizations, the economic issues facing our nation and regional consumer economy have negatively impacted our revenue growth," Tribal Council Chairman Michael Thomas said in a written statement.

The job cuts come just four months after Foxwoods opened with much fanfare a new $700 million skyscraper in the woods of Connecticut adjacent to the main casino. The MGM Grand at Foxwoods added 1,400 slot machines to Foxwoods' previous 7,200, as well as a new 4,000-seat theatre.
"People are gambling less" said tribe spokeswoman Lori Potter. "It's been sudden."

Since casinos depend on people with disposable income for their success, the credit crunch, combined with higher prices for energy and food staples, has had a devastating impact on gaming establishments nationwide.

In fact, gambling revenue on the famous Las Vegas Strip is down 6.5 percent in the year to July. This decline has hurt gaming giants such as MGM Mirage privately held Harrah's Entertainment -- owned by private equity firms Apollo Global Management and TPG Capital LP. At Foxwoods, gambling activity fluctuated over the summer before slowing sharply, Potter said. "There was a significant enough decline over just the past several weeks that we needed to make this adjustment," she said.

Following suit, the Mohegan tribe, which owns the rival Mohegan Sun casino, last week announced plans to scale back a $734 million expansion project at that facility, citing the weak economy.