The “second” estimate of U.S. real gross domestic product (GDP) for the fourth quarter of 2020 climbed 4.1 percent at an annual rate. Overall, the increase in real GDP benefitted from robust recovery in consumer spending and business investment, while net exports and government spending contributed negatively to growth. U.S. nonfarm employment posted a stronger-than-expected gain of 379,000 jobs in February. The largest gain occurred in the leisure-and-hospitality sector, adding 355,000 jobs as COVID related restrictions eased. Retail sales in January rose strongly by 5.3 and 7.4 percent, respectively, month-over-month and year-over-year likely due to the second relief checks. Housing starts in January, however, declined by 2.3 percent from last year, after four consecutive months of strong year-over-year gains. The most recent data indicate that the U.S. economy is gaining momentum. Rising interest rates could create headwinds, however.
Nevada’s economic activity posted positive signals based on the most recent monthly data. Seasonally adjusted statewide employment gained a robust 8,200 jobs in December. December taxable sales also showed a strong 18.3 percent month-over-month rise but a 6.9 percent year-over-year decrease.
Clark County displayed improved signals in local economic activity. The unemployment rate in December declined from 12 to 10.5 percent but remained the highest among large metropolitan areas. Total McCarran Airport passengers in January contracted month-over-month, while visitor volume gained 5.4 percent over the same period. Visitor volume still experienced a significant year-over-year decline of 63.6 percent. January gaming revenue improved month-over-month likely due to the second relief checks but still down by 31.7 percent year-over-year. December taxable sales, nevertheless, only decreased by 12.9 percent from last year. Residential housing permits/units in January continued its noticeable gain of 59.5 percent year-over-year because of the strong housing market with low mortgage rates.
Washoe County exhibited stronger signals in local economic activity due to its more diversified economy. The unemployment rate fell to 5.6 percent, lower than the national average. December taxable sales continued its strong year-over-year growth of 12.7 percent, while gasoline sales in gallons dropped by 7.4 percent over the same period. January residential permits/units were up by 19.5 percent from last year. January gaming revenue also climbed by 4.9 percent from a year ago.
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.