The “third” estimate of U.S. real gross domestic product (GDP) for the fourth quarter of 2020 increased 4.3 percent at an annual rate, revised up by 0.2 percent from the previous estimate. This reflected larger private inventory investment than previously reported, which was partly offset by a downward revision in nonresidential fixed investment. Retail sales in February were up robustly by 6.3 percent year-over-year and will likely experience a boost in March from the third stimulus checks. Housing starts in February, however, declined by 9.3 percent from last year, which may partly reflect rising interest rates and soaring building costs. The most recent data indicate that the U.S. economy shows signs of strong improvement benefiting from the $1.9 trillion relief package and ongoing vaccination efforts. 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 2,400 jobs in February. Gaming revenue and air passengers increased by 1.4 and 7.6 percent, respectively, month-over-month despite fewer days in February. They, nonetheless, still experienced double-digit losses compared to last year. January taxable sales only decreased by 4.1 percent year-over-year thanks to the federal stimulus money.
Clark County also displayed improved signals in local economic activity. Seasonally adjusted employment added 3,200 jobs in February. Total McCarran Airport passengers, gaming revenue and visitor volume in February improved month-over-month but still experienced significant year-over-year decreases of 58.2, 29.6, and 54.4 percent, respectively. January taxable sales, nevertheless, only fell by 8.5 percent from last year. Residential housing permits/units in February also continued its year-over-year gain of 15.5 percent. The recovery in the tourism sector lags far behind compared to other sectors due to COVID-19. The local tourism sector, however, recently showed early signs of renewed recovery.
Washoe County exhibited favorable signals in local economic activity. The Reno-Sparks seasonally adjusted employment gained 300 jobs in February. The unemployment rate fell to 4.8 percent, much lower than the national average and half the rate as in Clark County. January taxable sales continued to increase robustly by 9.7 percent year-over-year, while gasoline sales in gallons are down by 9.3 percent over the same period. February residential permits/units were up strongly by 28.0 percent from last year.
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.