The first estimate for U.S. real gross domestic product (GDP) for the third quarter of 2015 reports a 1.5 percent annualized growth rate, a 61 percent decline from the second quarter. Despite modest growth, the Bureau of Economic Analysis stated that U.S. domestic consumption, which accounts for about two-thirds of real GDP, remained strong. More specifically, personal consumption expenditures, state and local government spending, business investment and residential investment contributed positively to growth; while private inventory investment and net exports contributed negatively. Spurred by a U.S. nonfarm employment increase of 271,000 jobs in October, the unemployment rate dropped from 5.1 to 5.0 percent, its lowest level since April 2008. Housing starts increased strongly both month-over-month and year-over-year in September, and housing prices increased, suggesting that the recovery in U.S. real estate markets will continue. Auto/truck sales remained robustly above their respective levels from last year and last month. Retail sales also showed a firm year-over-year growth.
Overall, the Nevada economy posted significant positive signals from the most recent data releases. The Nevada unemployment rate fell from 6.8 percent to 6.7 percent. August taxable sales experienced a stable year-over-year growth, up 2.2 percent. Gasoline sales displayed strong growth both month-over-month and year-over-year, up by 4.7 percent and 6.0 percent, respectively. Total air passengers increased by 5.8 percent year-over-year, and gaming revenue increased 1.5 percent year-over-year.
For Clark County, mixed signals emerged. Seasonally adjusted employment fell from August to September by 0.3 percent but increased 2.3 percent year-over-year. Total air passengers at McCarran Airport rose 5.9 percent from a year earlier. September visitor volume increased 5.9 percent from last year. Clark County’s taxable sales and gasoline sales for August were 1.8 percent and 6.6 percent above those of a year earlier, respectively. Residential permits fell 30.4 percent from a year ago, and commercial permits remained at a low level. Gaming revenue gained 1.3 percent compared to September 2014.
The most recent data showed somewhat less mixed signals for Washoe County. The Reno-Sparks seasonally adjusted employment increased by 0.4 percent from August to September and rose 3.2 percent from a year ago. September visitor volume and total passengers increased 3.0 percent and 4.3 percent, respectively, from last year. Taxable sales for August increased 6.9 percent year-over-year, and gaming revenues for September increased 8.1 percent from a year earlier. Nevertheless, residential permits fell substantially, 33.3 percent from a year ago.
Giorgio Canarella, Economist, and Jinju Lee, Eonomic Analyst, UNLV Center for Business and Economic Research