Business Indicators
by R. Keith Schwer
The U.S. and Nevada economies continue adjusting to housing problems. Nationally, housing starts are off 30.8 percent September 2007 from the same month a year earlier. Reno shows a similar sharp drop with permitting down 40.1 percent. Las Vegas, on the other hand, shows a jump in permitting. This is an unsustainable increase as the abundant supply of unoccupied units will take some time to fill.
Against the headwinds of housing rebalancing other sectors show a mixed picture. Nationally, consumer spending, accounting for more than 70 percent of total spending, is up 5 percent over the past year. Big ticket items, autos and housing, show declines. Business profits have remained strong, resulting in a run up in stock prices; the S and P 500 is 3.6 percent over the past months and 14.3 percent over the past year.
In Nevada, most recent indicators show declines and modest improvement. Visitor volume in the Silver State is off modestly, down at an annual rate of 0.8 percent. State-level gaming revenue and taxable sales are off 2.6 and 4.4 percent from year ago levels. Still, jobs growth is up over the past year by 1.3, 1.4, and 1.3 percent for Nevada, Las Vegas, and Reno respectively.
Though the risks of recession are higher than they have been for some time and the unknown fallout from further housing market problems remain, the Silver State continues attracting new investments; a vote of confidence in the state’s future economic prospects.
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