The “advance” estimate of U.S. real gross domestic product (GDP) for the first quarter of 2019 increased unexpectedly by 3.2 percent at an annualized rate. Although the growth rate marked its fastest first quarter increase since 2015, the overall real GDP growth included some temporary factors – reduced imports and higher private business inventories. Thus, the unexpected gain of real GDP mainly reflected a substantial reduction in the trade deficit and increases in private business inventories and state and local government spending. Consumer spending and private business investment, which largely caused real GDP growth in 2018, slowed, however. In addition, residential investment continued to post its fifth consecutive quarterly loss. Retail sales growth in March accelerated to 3.6 percent after weak gains for three months.
The Nevada economy posted mixed signals with the most recent data releases. Seasonally adjusted statewide employment gained 1,700 jobs in March with the main contributors coming from the construction and financial activities sectors. February taxable sales increased by a robust 4.8 percent from last year, but at a slower pace compared to the last four months. Gasoline sales, however, declined by 2.3 percent over the same period. March Nevada air passengers rose by 2.7 percent year-over-year.
Clark County experienced somewhat mixed signals in its economic activity relative to last month. The unemployment rate in March reached 4.3 percent, its lowest level since the Great Recession. March visitor volume in Clark County decreased by 1.4 percent year-over-year, and gaming revenue also declined by 0.6 percent during the same period. Total McCarran Airport passengers in March climbed by 2.6 percent year-over-year. February taxable sales experienced a strong year-over-year gain, up by 7.1 percent. Residential housing permits/units in March fell significantly by 45.8 percent from last year, which may reflect a recent slowing in the housing market.
Washoe County also posted generally mixed economic signals. The unemployment rate ticked down to 3.3 percent, its lowest level since May 2000. February taxable sales for Washoe and Storey Counties again declined by 5.8 percent year-over-year after a strong rebound last month, and gasoline sales were also down sharply by 5.8 percent over the same period. March visitor volume experienced a continued year-over-year loss of 8.4 percent. March gaming revenue also fell by 0.9 percent from a year ago. March total airport passengers, however, exceeded the level from last year by 7.6 percent.
Stephen M. Miller, Director
Jinju Lee, Economic Analyst
UNLV Center for Business and Economic Research
The views expressed are those of the authors and do not necessarily represent those of the University of Nevada, Las Vegas or the Nevada System of Higher Education.