Las Vegas business leaders say confidence levels at 3-year high

By Buck Wargo

Thursday, Feb. 3, 2011 | 1:18 p.m.

Despite the continuation of the recession in Las Vegas, the confidence level by the valley’s business leaders has reached is highest point in three years, according to UNLV economists.

The Center for Business and Economic Research reported its Business Confidence Index rose above 100 for the first time in its three-year history. A value above 100 means those who responded to the survey on average were more optimistic than pessimistic about Nevada’s economy, sales, profits, hiring and capital expenditures.

The gap wasn’t large between those optimistic and pessimistic, but it was finally positive when it comes to the economy, sales and profits. Business leaders, however, were’t optimistic about hiring picking up anytime soon.

Stephen Brown, the center’s director, said similar surveys across the country have a good track record of reflecting the sentiment of business and where a local economy is heading. Visitor volume, gaming revenue and retail sales picked up in the later part of 2010 and signs point to an improvement so far in 2011, he said.

“This news suggests Southern Nevada’s economy my have began a long-awaited recovery,” Brown said. “These businesses are basing their responses on what they are seeing and experiencing.”

The results showed nearly 34 percent of business leaders said they expected the economy to improve in the first quarter of 2011. Some 25 percent said they expect the economy to worsen.

They were more optimistic about the U.S. economy with 56 percent expecting improvement and only 13 percent expecting it to worsen.

When it came to sales and profits in their own industry, 39 percent said they expected an increase and only 18 percent expected a decline in sales. Some 39 percent projected increase profits and 23 percent expected them to fall.

Business leaders aren’t as optimistic about the job market in their industries. Nearly 14 percent projected an increase while 24 percent expected a decrease. The remainder expected no change.

In the real estate and construction industry, 57 percent said it won’t be until 2013 or beyond before Southern Nevada home prices show “signs of a meaningful recovery.” Some 31 said it won’t occur until 2012 and 12 percent said it would happen by the end of 2011.

Nearly 69 percent said the construction industry won’t improve until 2013 or later. Some 23 percent said it would happen in 2012. Eight percent said they expect gains in the second half of 2011.