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Oct. 07, 2006
Copyright © Las Vegas Review-Journal


ECONOMY: Job market takes step forward

Small companies in Nevada adding staff, data show

By JENNIFER ROBISON
REVIEW-JOURNAL




Desert Specialty Rigging Supply owners from left, Patti and Richard Redd pose Friday with rigger Tyler Prettyman at the company's office in Las Vegas. Patti Redd said she's grown her staff by 25 percent in the last year, to 10 workers from eight.
Photo by Gary Thompson.

A continuing local construction boom is helping Patti Redd build a bigger business.

Redd, assistant manager of Desert Specialty Rigging Supply in Las Vegas, said she's added 25 percent to her employee roster in the last year, expanding her company from eight workers to 10.

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And Redd's not finished hiring: She's on the lookout for two more customer-service or production staffers on the company's rigging side, which provides cables and machinery for hoisting construction workers, entertainment equipment and trade-show props. When her business opens its safety-training center in December, Redd will need at least two additional employees.

Behind the flourishing company is a near-constant parade of new building projects, Strip shows and conventions.

"The economy in the city has been very good, and we've been able to add to our payroll as our business has increased," Redd said.

A national report reveals small businesses across Nevada are posting big employment gains.

The SurePayroll Small Business Scorecard shows that staffs among the Silver State's small companies grew an average of 5 percent in the first three quarters of the year, from 4.64 workers on Dec. 31 to 4.88 workers on Sept. 30.

Those numbers are an improvement on hiring in the first nine months of 2005, when staffs among Nevada's small businesses shrank an average of 1.4 percent.

Nationwide, small businesses experienced a work-force decline of 0.3 percent from December through September. Only Utah, with its small-business employment growth of 7.7 percent, bested Nevada's expansion rate. The labor forces of small businesses in California grew an average of 1.1 percent.

SurePayroll's statistics come from a nationwide look at the wages of more than 17,000 businesses with 100 or fewer workers.

Michael Alter, president of Glenview, Ill.-based SurePayroll, credited Nevada's tourism-oriented economy for strong hiring in the state.

"The tourism and gambling sectors tend to do well no matter what the economy is doing," Alter said. "In a recession, everyone wants to make a fortune and forget their problems, and in a recovery, everyone has extra money to spend."

Alter said the Las Vegas economy in particular benefits from a burgeoning convention industry and a sustained supply of new megaresorts. Construction of MGM Mirage's $7 billion Project CityCenter is under way south of Bellagio, and Boyd Gaming Corp. will break ground in 2007 on its $4 billion Echelon Place on the Stardust site.

"You've got a lot of money coming in and being spent," Alter said. "You have a very robust economy, and where larger businesses do well, all sorts of smaller businesses can benefit."

Cornelius Eason, president of Priority Staffing USA in Las Vegas, said annual sales growth is averaging 20 percent to 30 percent among the small businesses that hire workers through his employment agency.

"With that kind of growth, you need more employees to handle the new business," Eason said.

A healthy resort sector is partly behind the brisk growth at Commercial Hardware, a Las Vegas company that provides shelves, racks and pallets for storage, as well as wheels and casters for housecleaning carts and hand trucks.

Dave Hough, president of Commercial Hardware, said Southern Nevada's hotel-casinos have a total of more than 20,000 housecleaning carts -- a massive fleet that requires continual maintenance.

But Hough said his company, which he's owned since 1993, is no longer reliant on the hospitality sector for business.

A diversifying local economy has brought delivery companies, construction businesses and produce suppliers into Commercial Hardware's client fold. Ten years ago, Commercial Hardware's customer base was 80 percent casinos; today, that share has dropped to 50 percent, Hough said.

Rising real-estate costs have also meant more business for Commercial Hardware: Rather than paying higher rents for larger warehouses, many local companies now retain existing space and add floor-to-ceiling shelving to raise storage capacity.

Those dynamics are pushing sales at Commercial Hardware up 20 percent a year, and the company has gone from 14 workers a year ago to 16 workers today. Hough said he also has two openings in the company's sales and warehouse segments.

Finding workers is proving tough for local small businesses, though.

Overall joblessness in August was 4.1 percent in Las Vegas and 4.2 percent in Nevada, according to the most recent data from the Nevada Department of Employment, Training & Rehabilitation.

Eason said those low unemployment rates set up stiff competition for workers between small businesses and big companies, many of which offer more extensive benefits than their smaller counterparts can provide.

Both Redd and Hough said they've lifted salaries about 10 percent in the last year to help with recruiting and retaining workers.

Those raises closely match SurePayroll's September compensation analysis.

The Small Business Scorecard found that the average small-business paycheck reached $27,460 at the end of September, an 11 percent increase over the typical wage in September 2005.

"We're doing as aggressive a job as we can to keep our current employees," Redd said. "Part of that involves giving them good raises so they're not looking elsewhere for work. It's important to reward your good people."


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