Economist sees Las Vegas rebound slower than rest of U.S.

By Buck Wargo (contact), In Business reporter

Fri, May 8, 2009 (2 a.m.)

The local economy is still declining, albeit at a slower pace, and should lag behind the recovery of the rest of the nation, according to a UNLV economist.

The Center for Business and Economic Research’s Southern Nevada Index of Leading Economic Indicators for April shows all 10 categories declined compared with a year ago. The April index measures data from February and is a forecast of the local economy through Aug. 1.

Gross gaming revenues fell 23 percent, convention attendance dropped 14 percent and visitor volume dropped 9 percent. Taxable sales fell 17 percent, the value of commercial permits fell 51 percent and residential permit values declined 74 percent.

“The index is continuing to drop, and it is a reflection of continuing economic decline,” said Keith Schwer, the center’s director. “There is no (sign of) the bottom.”

There has been some good news with gains in the stock market, and it appears the nation’s economy is bottoming out, Schwer said.

The rate of decline in Southern Nevada’s economy has slowed slightly, according to the numbers, but it’s premature to call it a trend or to say it’s bottoming out yet, Schwer said.

“Most states have not been as adversely affected as the housing bubble states (such as Nevada) or the big-ticket manufacturing states (such as Michigan),” Schwer said. “It is more likely that we will not see the first signs of a national recovery in Nevada.”

Consumers are likely to wait until they feel more secure about the economy and their jobs before they start spending money, Schwer said. The rising unemployment rate, job uncertainty and possible income losses have resulted in more conservative spending on cars, housing and other big-ticket items, he said.

Job losses in Nevada show no sign of abating and unemployment is likely to exceed 12 percent, Schwer said.

The local economy will continue to take a hit from the credit crunch. Schwer said. Las Vegas has been more dependent on Wall Street capital than the rest of the country because of the need for financing for casinos and major projects, he said.

Discussion: 8 comments so far…

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By formervegas76

May 8, 2009

3:31 a.m.

Suggest removal

overbuilt, overpriced, please vegas get back to the basics. the genie is out of the bottle on gaming around the country. most people can go a few hours and find a place to play. to pay $400 for a airplane ticket just to get vegas, you better put up a better product than we're getting now.
By judgesmales

May 8, 2009

3:44 a.m.

Suggest removal

Disregard this story, because I'm sure James "Sunshine and Lollipops" Reza will drop by to tell us how Las Vegas is nearing the bottom and recovery is beginning. LOL.
By mcmc_john

May 8, 2009

7:15 a.m.

Suggest removal

and yet we continue to do the same thing today as we did yesterday... just less of it...

if the commissioners in Clark County don't make some major changes to the way they operate ... unemployment will surpass 17%...and the recession in Clark County will be spelled ... d.e.p.r.e.s.s.i.o.n.
By neiman1

May 8, 2009

7:41 a.m.

Suggest removal

Maybe all the new jobs from mining will help. How about all the jobs at Yucca? Maybe more jobs from ??? government? What is it harry Reid? What's the plan?
By davidwayneosedach

May 9, 2009

8:15 a.m.

Suggest removal

I don't think any city in the US is near the beginning of recovery. Who knows - maybe Las Vegas will be among the first.
By ruby777

May 9, 2009

9:46 a.m.

Suggest removal

"overbuilt, overpriced, please vegas get back to the basics. .....to pay $400 for a airplane ticket just to get vegas, you better put up a better product than we're getting now"

Exactly. There lies the problem. Make it reasonable again to come here, and people will come. As I undertand, contrary to the numbers that the casinos keep posting, the Strip is still crowded (and we know it's not the locals down there!) SO people are still coming here....but are taking advantage of the deals! Once the casinos realize and accept gone are the days of $500 a night room rates, their properties will fill up again. I have friends coming in next month and they got a great deal - 4 nights at the Mirage, plus airfare ($300 average cost from Chicago) for $500 each. That's a pretty decent price.
*****

"I don't think any city in the US is near the beginning of recovery. Who knows - maybe Las Vegas will be among the first."

I agree. I believe we are in a better position than most cities, because once people have extra money to spend, they will want to forget about their problems and go and have a good time. Las Vegas has always been there for that reason - good times and bad.

Also - locals are spending money. Every store I have been in this past week - people were shopping and buying. It may not make a big difference, but it was good to see. I have friends in retail and they said business has been steady.
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By geenab65

May 9, 2009

2:01 p.m.

Suggest removal

"overbuilt, overpriced, please vegas get back to the basics. .....to pay $400 for a airplane ticket just to get vegas, you better put up a better product than we're getting now"

Phew I am so GLAD that it's not just me that sees the issues!! People are more cautious with their monies for now and a long time to come.

Vegas!! I implore you!! Get over yourself!!!
By Babyboomer

May 9, 2009

4:20 p.m.

Suggest removal

I have no doubt Las Vegas will trail the rest of the country with recovery.Take a hard look at all that was turned up side down unlike many places in the US....it will be a new Las Vegas a new way of doing business and all the better for it.The question is...will Las Vegas learn anything from all this mess ? I sincerely hope so.