The economic fallout from the September 11th terrorist attacks now appears in key data series, revealing both anticipated and unusual changes. Unemployment rates moved upward as anticipated, increasing most notably for Clark County (Las Vegas Metropolitan Area) from a pre-attack level of 5 percent to a post-attack level of 6.7 percent. With air travel halted and the attention of the country focused on current events, economic activity slowed. Surprisingly, September gaming revenue held up better than expected, declining 3.1, 2.4, and 7.7 percent, respectively, for Nevada, Clark, and Washoe (Reno) counties. This better-than-expected performance was, however, at the expense of significant price concessions. A strong period of activity during early September also helped. As a result, October numbers may be more representative than September’s.
As concern for air safety increased and numbers of flights were reduced by a financially stressed industry, travel to Nevada destinations by automobile rebounded more quickly than air travel. Gasoline sales dropped by slightly more than 10 percent a general measure of overall travel activity.
An official review of recession dating by the National Bureau of Economic Research has dated March 2001 as the peak in the national economy. A peak marks the end of an expansion and the beginning of a recession. Still, the dating of past events is an issue of less importance than efforts to return the economy to expansion. Expansionary efforts to bolster activity include the Federal Reserves’ reduction of the federal funds and discount rates on 10 separate occasions in 2001. Efforts to step up spending have also come from federal tax rebates and from a proposed stimulus package. The latter effort is, however, having difficulty clearing the political hurdles of a divided Congress. All in all, 2001 will go down as a year of economic travail, and hopes are for a return to growth in 2002.