Las Vegas ranked in the bottom third in economic recovery among the nation’s 100 largest cities during the first quarter, a report released Wednesday by the Brookings Institution shows.
The MetroMonitor, published quarterly by the Washington-based think tank, ranked Las Vegas as No. 88 in the nation for economic strength.
The report, which uses first-quarter data, shows Las Vegas moved up from a No. 98 ranking in the previous quarter. The local economy has benefited from a modest increase in gross metropolitan output and a declining unemployment rate, Brookings said.
Mark Muro, a senior fellow and policy director with Brookings’ Metropolitan Policy Program, cited two key factors for the "anemic recovery in Las Vegas."
"The real estate market is beginning to heal, but there is such a substantial overhang that it has to be reduced before job creation can take hold," Muro said.
He said the region has been "weighed down" by the general decline in consumer confidence in the United States and worldwide.
Las Vegas ranked 28th in the nation for housing prices, and the report indicated they fell by 1.9 percent in the first quarter. The region’s decline was smaller than the national average, a drop of 2.1 percent.
Las Vegas ranked 53rd among the top 100 metropolitan areas for its unemployment rate, which fell 0.7 percent in the first quarter. The region ranked poorly for gross metropolitan output, placing 88th in the nation in the first quarter.
Muro said employment growth in smaller industry sectors has benefited Las Vegas.
Employment in information, which includes technology, grew by 3.2 percent in the first quarter, while mining jumped 8.2 percent. Leisure and hospitality job creation was a modest 0.2 percent in the first quarter.
"It’s been tough," Muro said. "Switch and what Tony Hsieh has been doing with technology downtown are beneficial. You have had growth, but these (industries) remain small."
Switch builds and operates data centers for Fortune 500 companies, while Hsieh has expanded his Zappos empire to include support for local tech businesses that locate in downtown Las Vegas.
In the last recession, Muro said, the Mountain West region drove the recovery, with Las Vegas outpacing its Western rivals. This time Las Vegas, expect for quarterly gross metropolitan output, is trailing the region’s other major cities.
The major cities in the Mountain West include Las Vegas, Phoenix, Denver, Boise, Idaho, and Albuquerque, N.M. The report shows Phoenix leading the region with the nation’s fifth-strongest economy, helped by a recovery in the housing market.
Phoenix ranked second nationally for housing prices, even though the report found prices there fell 0.9 percent in the first quarter. The region ranked 20th in unemployment, but ranked poorly for gross metropolitan output in the first quarter, placing 90th in the nation.
"Looking forward, it’s extremely likely that the slowed U.S. job growth we’ve seen in the second quarter will affect trends in the region’s metropolitan economies," said Robert Lang, co-director of Brookings Mountain West, the think tank’s subsidiary at the University of Nevada, Las Vegas. "At the same time, it’s equally likely that the tremendous variation in the pace of the Mountain regions’ recovery will persist."
Given Washington gridlock on economic policy, Lang said local and regional leaders face difficult tasks of fostering job creation in the short term, while positioning themselves for long-term, sustainable growth.
Overall, the report showed employment growth accelerating across most of the nation’s largest metropolitan areas with average employment rising 0.5 percent, while gross domestic product increased 0.6 percent from January to March.
"The economic news varies depending on where you live," said Alec Friedhoff, a research analysts with the Metropolitan Policy Program at Brookings that produces the report. "Certain high-tech regions, manufacturing centers and places in the Mountain West have rebounded recently."
Contact reporter Chris Sieroty at email@example.com or 702-477-3893.Strongest Economies
Here are the Top 10 metro areas for economic growth, according the Brookings Institute MetroMonitor report.
1. New Orleans
2. Houston/Sugarland, Texas
3. Grand Rapids/Wyoming, Mich.
4. Detroit/Warren, Mich.
6. Boise, Idaho
7. Cape Coral/Fort Myers, Fla.
8. Austin/Round Rock, Texas
9. San Jose/Santa Clara, Calif.
10. Youngstown/Warren/Boardman, Ohio & Penn.