June 17, 2014 - 12:14 pm
Southern Nevada’s economy will continue to strengthen through 2014 as tourism, gaming, construction and the housing industries plod toward pre-recession levels.
Current trends indicate the region is continuing its fourth year of recovery from the economic downturn that hurt Nevada worse than any other state, said Stephen Brown, director of the Center for Business and Economic Research at the University of Nevada, Las Vegas.
Brown delivered UNLV’s midyear economic outlook seminar Tuesday at The Venetian.
“The good news,” Brown said, “is that the Southern Nevada economy is improving and at an accelerating rate. But the great news is that the growth is widespread across Southern Nevada’s industries.”
Brown said the U.S. economy is on the cusp of acceleration and Nevada is returning to its long-term trends, which generally have been healthier than the rest of the nation.
Visitor volume and gaming revenue are climbing at rates of less than 3 percent with Strip resorts supporting the bulk of the growth.
In 2013, Southern Nevada visitation fell less than a half percent from 2012’s record level. This year, volume is on a record pace and is expected to eclipse 40 million people for the first time. March, Brown noted, was Southern Nevada’s best-ever tourism month.
Brown is forecasting a 0.9 percent increase in visitor volume in 2014 and 2 percent more in 2015.
Gaming numbers also are slowly picking up.
Still well below the $1.1 billion in average monthly gross gaming revenue levels of late 2007, amounts have slowly climbed from a low point in 2010 to a more than $900 million monthly average in 2014.
Brown noted that tourism and gaming continues to be driven by the Strip.
“It’s been established that the closer you are to the Las Vegas Strip, the bigger the share you’re getting,” he said. “As you move away from the Strip to other parts of Las Vegas, to other parts of Clark County and all of Nevada, the growth isn’t quite as strong.”
Brown, who attributes slow growth in gaming revenue to increased industry competition nationwide, is forecasting a 3.2 percent increase in revenue in 2014 and 3.7 percent in 2015.
After a collapse in housing construction from 2007 to 2010 and languishing levels through 2012, the rate of new housing permits issued in Clark County is finally starting to rebound.
Brown also said vacancy rates in retail, office and industrial real estate have begun to fall with retail and industrial space at just over 11 percent and office vacancies at 22.7 percent.
Housing prices are on the rise with Las Vegas prices up 44.8 percent since hitting bottom in early 2012. A lack of single-family housing supply is pushing up housing prices.
Nevada still has the highest percentage of homeowners that are underwater on their mortgages, but the number is slowly declining. In 2014’s first quarter, 29.4 percent of Nevada homeowners had negative equity, an improvement from the 45.4 percent in the first quarter of 2013.
Nevada’s unemployment roller-coaster ride is continuing and currently is on an upswing.
From January 1990 to December 2007, Nevada led the nation in job growth. But in 2008, 43 states lost jobs and Nevada suffered the worst decline. In 2009, 49 states had job losses and, again, Nevada led. In 2010, 47 states added jobs — but Nevada was one of three states that saw a decline, the worst in the nation.
In 2011, an upswing began with Nevada 35th among 49 states that saw job growth. In 2012, 48 states added jobs and Nevada ranked 13th in growth. In 2013, 49 states added jobs and Nevada trailed only North Dakota with its growth rate.
Brown said Nevada is off to a good start in 2014, adding 19,800 jobs in the first four months of the year, a 5.1 percent increase.
Contact reporter Richard N. Velotta at email@example.com or 702-477-3893. Follow him on Twitter @RickVelotta.