The U.S. economy continues to experience slowing growth. Second quarter data for U.S. real GDP show an annualized growth rate of 1.5 percent, lower than the annualized rate of 2.0 percent during first quarter 2012. Consumer spending drove most of the gains, but was much lower than in first quarter. Business fixed investment and residential investment also made smaller contributions than in previous quarters. Government spending and net exports made negative contributions. For almost a year now, the quantity of commercial paper outstanding has remained low—an indication that little external financing is being used to support business investment.
The Nevada economy showed mixed signs. Seasonally adjusted, statewide employment decreased by 1,000 jobs (0.1 percent) from May to June. The Nevada unemployment rate remained stable at 11.6 percent in June. Visitor volume was 1.9 percent higher in June than a year earlier. Gaming revenue was 6.0 percent lower in June than a year earlier, mostly as the result of reduced slot machine play. More favorably, taxable sales were 10.4 percent higher in May than a year earlier.
Clark County’s economy also saw mixed signs. Seasonally adjusted, the region’s employment showed no change from May to June, remaining at 813,600 jobs. Nonetheless, the Las Vegas unemployment rate fell from 12.2 percent in May to 12.0 percent in June. Compared to a year earlier, visitor volume was up by 1.8 percent in June. Gaming revenue was 7.9 percent lower in June than a year earlier, mostly as the result of reduced slot machine play. Similar to the state’s experience, Clark County’s taxable sales for May were 10.0 percent above those for a year earlier. Residential construction permits rose sharply in June. Commercial construction permits remained volatile at a low level.
Washoe County saw mostly positive signs, despite a weak month for jobs. Seasonally adjusted Reno-Sparks employment decreased by 600 jobs (0.3 percent) from May to June. The Reno-Sparks unemployment rate rose slightly, from 11.5 percent in May to 11.6 in June. Compared to a year earlier, June visitor volume was up by 3.4 percent. Gaming revenues for June were up by 7.3 percent over the same period. Residential construction permits increased in June, while commercial construction permits remained at a low level.
U.S. economic growth slipped even further during the second quarter, and preliminary signals—such as weak gains in employment and decreases in personal consumption expenditures—indicate much of the same for the third quarter. Nevada is beginning to see evidence of sluggish U.S. economic growth in the form of slowing growth of its tourism. Nonetheless, the most recent data suggest relative stability in Nevada’s employment and gains in spending.
Ryan T. Kennelly
UNLV Center for Business and Economic Research
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