Nevada puts ‘F’ in manufacturing

Nevada brought home poor grades in a number of areas that are considered key to economic success in manufacturing and logistics — with the state’s approach to taxes showing up as a potential problem — in a new report from Indiana’s Ball State University.

The 2011 Manufacturing and Logistics National Report gave Nevada an “F” in manufacturing and a “D” in logistics, human capital and global reach. The state got a “D+” in diversification.

What stood out in the nationwide survey was a feeling that Nevada’s declining property tax revenue is going to hurt chances of recruiting more manufacturing, said Michael Hicks, director of the Center for Business and Economic Research at Ball State.

That Nevada joined Alaska, Hawaii and New Mexico as states getting an “F” in manufacturing was no surprise, given the state’s traditional lack of a manufacturing base, Hicks said.

The problem for Nevada is its tax climate, which received a “C” grade, Hicks said.

“Given what happened in the housing market, the expectation that you can maintain taxes at the current level is optimistic,” he said. “There’s going to be a time in the next few years where you face some very difficult choices. It means a really tough environment for schools.”

State and local tax rates — along with the quality of local public goods — are among the biggest concerns for relocating companies that can land virtually anywhere, Hicks said. Companies will likely stay away from states with an unstable tax base, he said.

The tax climate is measured with data on corporate taxes, income and sales taxes, and property and unemployment insurance taxes. They all play a role in assessing potential relocation, he said.

The manufacturing report card did not surprise Somer Hollingsworth, president and chief executive of the Nevada Development Association. However, he felt Nevada was cheated in some areas.

“If we got a ‘C’ in tax climate, then Ball State doesn’t know what they’re doing,” Hollingsworth said. “We always rank at the top of the country. We’ve got a pretty good reputation around the country as a place you can do well in manufacturing.”

The Ball State report does not capture business-friendly incentives such as property tax abatements because they’re “too invisible” to measure, Hicks said. Unlike California, Nevada doesn’t have a problem with its pension obligations, but unemployment insurance and sales taxes are both high compared with the rest of the nation, he said.

Nevada is not much of a manufacturing state, but it’s growing rapidly, Hollingsworth said.

Amonix opened a solar-panel manufacturing plant in North Las Vegas; Quebec-based Foliot Furniture opened a 310,000-square-foot production building and 6,000-square-foot showroom in the airport submarket; and Hydr-O-Dynamic Corp. set up a plastic molding injection facility on Harmon Avenue.

“I wish we had more manufacturing,” Hollingsworth said. “The guys we have, they like it. We’re in our infancy.”

Hollingsworth also differed with the Ball State report on human capital. Nevada has an employee base of skilled and qualified workers who can be trained for other jobs. Amonix received $4,000 per employee for training, he said.

Hicks said the 2011 Manufacturing and Logistics National Report doesn’t measure available labor, but the quality of that labor in terms of high school and college degrees.

“By those measures, Nevada doesn’t do well. That can be offset by a bigger pool of workers,” Hicks said.

One positive for Las Vegas is housing affordability.

“Same thing with Detroit. Right now it looks like a lot of people are considering Detroit because they can buy a house for nothing. If you fill up their tank with gas, they’ll give you the keys to the front door,” Hicks said.

Contact reporter Hubble Smith at hsmith@reviewjournal.com or 702-383-0491.

ad-high_impact_4
Business
Facial recognition software at G2E
Shing Tao, CEO of Las Vegas-based Remark Holdings, talks about his facial recognition product. (Todd Prince/Las Vegas Review-Journal)
Former NBA player, Shaquille O'Neal, speaks about his new Las Vegas chicken restaurant
Former NBA player, Shaquille O'Neal, speaks about his new Las Vegas chicken restaurant. Bizuayehu Tesfaye/Las Vegas Review-Journal @bizutesfaye
Bobby Baldwin to leave MGM
MGM Resorts International executive and professional poker player Bobby Baldwin is set to leave MGM.
Caesars has new armed emergency response teams
Caesars Entertainment Corp. has created armed emergency response teams. They are composed of former military and law enforcement officials. "These teams provide valuable additional security capabilities,” Caesars spokeswoman Jennifer Forkish said. Caesars is hiring Security Saturation Team supervisors, managers and officers, according to LinkedIn. The company did not say how many people it plans to hire for the units. (Las Vegas Review-Journal)
Las Vegas, airlines prepare for CES
CES in January is expected to attract more than 180,000 attendees. (Las Vegas Review-Journal)
AGS partners with Vegas Golden Knights
AGS is the nation’s second-largest manufacturer of Class II slot machines used primarily in tribal jurisdictions. It announced a marketing partnership with the Vegas Golden Knights NHL team. (Las Vegas Review-Journal)
Lehman Brothers bet big on Las Vegas
Lehman Brothers collapsed 10 years ago, helping send the country into the Great Recession.
Fremont9 opens downtown
Fremont9 apartment complex has opened in downtown Las Vegas. (Marcus Villagran/Las Vegas Review-Journal) @marcusvillagran
Ross & Snow launches in Las Vegas
Luxury shoe brand Ross & Snow has opened in Las Vegas, featuring "functional luxury" with premium shearling footwear. (Bailey Schulz/Las Vegas Review-Journal)
Remote Identification and Drones
DJI vice president of policy and public affairs discusses using remote identification on drones. (Bailey Schulz/Las Vegas Review-Journal)
Drones and public safety in Nevada
Two representatives in the drone industry discuss UAV's impact on public safety. (Bailey Schulz/Las Vegas Review-Journal)
Frontier Airlines to launch flights from Las Vegas to Mexico
Frontier, a Denver-based ultra-low-cost carrier, will become the first airline in more than a decade to offer international service to Canada and Mexico from Las Vegas when flights to Cancun and Los Cabos begin Dec. 15. (Rick Velotta/Las Vegas Review-Journal)
MGM Resorts International CEO Jim Murren addresses Oct. 1 lawsuits
MGM Resorts International Chairman and CEO Jim Murren addresses criticism his company has received for filing a lawsuit against the survivors of the Oct. 1 shooting. (K.M. Cannon/Las Vegas Review-Journal)
MGM Resorts International opens the doors on MGM Springfield
Massachusetts’ first hotel-casino opens in downtown Springfield. The $960 million MGM Springfield has 252 rooms and 125,000-square-feet of casino. (K.M. Cannon/Las Vegas Review-Journal)
MGM Resorts International prepares to open MGM Springfield
Las Vegas-based MGM Resorts International gave news media and invited guests a preview of the $960 million MGM Springfield casino in Massachusetts. The commonwealth's first resort casino will open Friday, Aug. 24. (K.M. Cannon/Las Vegas Review-Journal)
A Walk Through Circus Circus
It only takes a short walk through Circus Circus to realize it attracts a demographic like no other casino on the Strip: families with young children. (Todd Prince/Las Vegas Review-Journal)
Morphy Auctions, a vintage slot machines seller, wants gaming license
Vice president Don Grimmer talks about Morphy Auctions at the company's warehouse located at 4520 Arville Street in Las Vegas on Thursday, Aug. 16, 2018. (Rick Velotta/Las Vegas Review-Journal)
Nevada's venture capital money doesn't stay in state
Zach Miles, associate vice president for economic development for UNLV, said there’s venture money in Southern Nevada, “but trying to find the right groups to tap into for that money is different.” According to a 2017 report from the Kauffman Foundation, Las Vegas ranked number 34 out of 40 metropolitan areas for growth entrepreneurship, a metric of how much startups grow. With a lack of growing startups in Las Vegas, investment money is being sent outside of state borders. The southwest region of the U.S. received $386 million in funding in the second quarter, with about $25.2 million in Nevada. The San Francisco area alone received about $5.6 billion. (source: CB Insights)
Neon wraps can light up the night for advertising
Vinyl wrap company 5150 Wraps talks about neon wraps, a new technology that the company believes can boost advertising at night. (Marcus Villagran/Las Vegas Review-Journal) @brokejournalist
Nevada on the forefront of drone safety
Dr. Chris Walach, senior director of Nevada Institute for Autonomous Systems, talks to a reporter at NIAS's new Nevada Drone Center for Excellence of Public Safety, located inside the Switch Innevation Center in Las Vegas. K.M. Cannon Las Vegas Review-Journal @KMCannonPhoto
Motel 8 on south Strip will become site of hotel-casino
Israeli hoteliers Asher Gabay and Benny Zerah bought Motel 8 on the south Strip for $7.4 million, records show. They plan to bulldoze the property and build a hotel-casino. Motel 8 was built in the 1960s and used to be one of several roadside inns on what's now the south Strip. But it looks out of place today, dwarfed by the towering Mandalay Bay right across the street.
Project billed as one of the world's largest marijuana dispensaries plans to open Nov. 1
Planet 13 co-CEO Larry Scheffler talks about what to expect from the new marijuana dispensary, Thursday, July 19, 2018. (Marcus Villagran/Las Vegas Review-Journal) @brokejournalist
Oasis Biotech opens in Las Vegas
Brock Leach, chief operating officer of Oasis Biotech, discusses the new plant factory at its grand opening on July 18. (Bailey Schulz/Las Vegas Review-Journal)
UNLV Tech Park innovation building breaks ground
Construction on the first innovation building at the UNLV Tech Park is underway. (Bailey Schulz/Las Vegas Review-Journal)
TOP NEWS
News Headlines
Add Event
Home Front Page Footer Listing
Circular
You May Like

You May Like