Giselle Lei isn't old enough to step inside a casino, but casinos have always been part of her life.

"My whole childhood is like, 'Oh, we're a gambling city. Everyone comes here for gambling,'" she said.

But Ms Lei believes Macau has more to offer than games of chance.

Billions are won and lost in Macau's opulent gaming halls every year, with the government relying on the industry for more than 80 per cent of revenue.

But the risk of being so heavily dependent on a single industry can no longer be ignored.

Almost 40 million visitors piled into Macau in 2019, but the gambling capital's luck ran out after the outbreak of COVID-19.

Gaming revenue plunged 95 per cent in 2021 and the sector is struggling to recover.

The local government and Ms Lei want Macau to bet on a different future before it goes bust.

"If another COVID hits, boom, we're gone," Ms Lei said.

She moved to Melbourne in 2022 to study accounting but wants to return if there are career opportunities in new industries.

How to change a one-trick economy

The government launched its first "diversification strategy" in 2023.

It centres on developing four new industries: financial services, traditional Chinese medicine, high-tech, and events tourism.

To help these sectors grow, the government will launch new university courses, build infrastructure, and work to attract foreign enterprises.

Meanwhile, the six multinational casino companies that dominate the economy agreed to invest billions into Macau as a condition of renewing their operating licenses.

Much of that investment will target the non-gaming sector, such as facilities to host exhibitions, sports and cultural events.

But shifting the status quo won't be easy as casinos and their workers are unlikely to welcome cuts to jobs and profits in the name of diversification.

Sam Hou Fai, a former judge widely tipped to become the next leader of Macau, has been keen to promote the benefits of diversification and decry the "barbaric expansion" of the gaming industry and its "large negative impact on the city".

But the head of Macau Responsible Gaming Association, Billy Song, told Asia Gaming News that Macau "cannot simply reduce" the gaming industry and should "maintain stable fiscal revenue" to ensure the economy and residents "are not negatively affected".

Why did Macau go all in on gambling?

Gambling has been part of Macau society for hundreds, if not thousands of years, however, the first legal casinos appeared under Portuguese rule in the 1850s.

But the gaming industry really took off after Macau was handed back to China in 1999, restrictions on ownership were relaxed and more operators were granted licences.

Today, Macau has the only legal casinos in China, a situation made possible by Macau's status as a "special administrative region" under China's "one country, two systems" regime.

So Macau, like Hong Kong, has its own laws and leaders but it's not entirely out of reach of the central Chinese government.

And in recent years, one of Macau's biggest earners has raised eyebrows in Beijing.

Criminal crackdown eats into profits

Junkets, lavish tours catering for VIPs and high-rollers, brought billions into Macau but the sector has been plagued with allegations of money laundering, illegal gambling and criminal activity.

A government crackdown has seen junket revenue plummet while the number of registered operators has fallen from 235 to just 18.

One high-profile case saw billionaire "Junket King" Alvin Chau sentenced to 18 years in prison on charges including running illegal gaming activities.

Sociologist and cultural commentator Jasper Lio said Macau's move to diversify its economy was partly driven by Beijing's desire to "stop so much money flowing into Macau".

"So, they want to limit the size of [its] casino industry."

This crackdown is often blamed for the sluggish post-COVID recovery of gambling revenue.

But gamblers are still coming to Macau, even if they're not spending as much as VIPs on junkets.

Bloomberg Intelligence senior analyst Angelica HanLee said revenue generated by mass tourism was expected to surpass pre-pandemic levels by 5 per cent this year.

"Overall, gaming revenue is not recovering back to pre-pandemic levels, but this solid mass gaming revenue has surprising numbers," she said.

But will diversification actually work?

While diversification has its champions, it won't be easy for a resource-poor chain of islands with only about 700,000 residents.

Macau's push into financial services will face stiff competition from other regional hubs like Singapore, Hong Kong, Tokyo and Taipei.

Macau's visitor infrastructure and hospitality workforce will give it an edge in attracting more events.

But developing new industries will likely depend on whether Macau can attract enough workers and investors from outside its borders to get them off the ground.

Billy Chan, chair of the Australian Chamber of Commerce, Macau, said it was "crucial" that the government retained skilled workers "rather than losing them to nearby regions like Singapore".

"Many overseas experts want to bring their families but the restrictions on blue cards and temporary residence permits deter them from living and working here," he said.

"I've also seen some amazing professors and educators in the healthcare sector. They often receive only one- or two-year blue cards."

What does this all mean for locals?

As for the locals, Mr Lio said many older workers employed by the gaming industry were unlikely to have the qualifications needed to move to new growth industries.

"So if they lose their job because of their diversification, they don't have other abilities," he said.

But diversification is already winning the hearts of the next generation.

Ms Lei initially planned to build a career overseas, but the diversification drive and push into financial services prompted a change of heart.

"Even though right now it's still not like a very significant difference, I can see that they're trying to make that change," she said.

"That's definitely one of the big factors why I would decide to go back."