The U.S. economy continues an uneven recovery from its deepest recession since the Great Depression. The preliminary estimate of real GDP growth for fourth quarter 2010 was 3.1 percent at an annualized rate—considerably stronger than the 2.5 percent figure posted for third quarter 2010. U.S. nonfarm employment rose by a meager 36,000 jobs (seasonally adjusted) in January, marking the fourth straight month of increases. In addition, real personal consumption spending, retail sales and housing sales continued to rise in December. Consumer confidence, which had slipped in December, picked up slightly in January.
With U.S. consumption spending rising for the ninth straight month, the Nevada economy continues to show uneven signs of recovery. For second half 2010, Nevada visitor volume was up 2.6 percent over second half 2009. Gaming revenues for second half 2010 were up 1.5 percent over second half 2009, with December gaming revenue 2.0 percent above November but 2.4 percent below a year earlier. Even with tourism and gaming showing signs of improvement in second half 2010, the Nevada unemployment rate rose to a record high of 14.6 percent in December.
The economic picture for Clark County has been more robust than for the state as a whole. Visitor volume for second half 2010 was up 3.2 percent over second half 2009. Gaming revenues for second half 2010 were up 2.3 percent over second half 2009, with December gaming revenue 2.5 percent above November but 2.6 percent below a year earlier. November taxable sales were down 1.4 percent from October but higher than a year earlier. Residential construction permits surged upward and Las Vegas employment nudged upward in December. On the less favorable side, the Las Vegas unemployment rate rose to 14.9 percent in December, nearly matching the record high of 15.0 percent set in September.
Washoe County economic activity has been considerably weaker than for the state as a whole. Visitor volume for second half 2010 was 1.8 percent below that for second half 2009. Gaming revenues for second half 2010 were 4.5 percent below those for second half 2009, with December gaming revenue 1.1 percent above November but 0.7 percent below a year earlier. Residential construction permits and employment continued to fall in December, and the Reno-Sparks unemployment rate rose to a record 13.8 percent.
With the national recovery picking up steam, the Nevada economy shows uneven signs of growth. Given the reluctance of businesses to invest and hire, the growth of the U.S. economy is likely to remain uneven, which will likely mean a continued slow and uneven recovery for the Nevada economy.
Professor Stephen P. A. Brown, PhD
UNLV Center for Business and Economic Research