Southern Nevada Economy Remains Weak - 8 News NOW

Southern Nevada Economy Remains Weak

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LAS VEGAS -- While the Brookings Institution reported in December that the Las Vegas metro area began showing signs of "a relatively robust and sustained recovery" by September, the think tank also found that Southern Nevada continued to display one of the nation's weakest economic recoveries.

Among the nation's 100 largest metros, Las Vegas was among the weakest 20 in unemployment, bank-owned homes and gross metropolitan product, which measures the value of goods and services produced.

Metro areas that enjoyed the strongest economic recovery in the third quarter of 2011 included high technology centers such as San Jose, Calif., Ogden and Provo, Utah, and Boston and regions in the Great Lakes that specialize in production of automobiles and related products.

Brookings, based in Washington, D.C., identified Las Vegas as one of only six metros that had slowdowns in both job growth and output growth between the second and third quarters of 2011. The think tank identified 61 metros that had fully recovered from the recession in terms of economic output. But Las Vegas was identified among eight other metros -- mostly ones that suffered severe housing price declines -- that had recovered less than a quarter of the output they lost during the recession.

Las Vegas was also identified as one of only three metros, along with Modesto and Stockton, Calif., where housing prices were still more thjn 60 percent below their pre-recession peaks.

A companion report, also released in December by Brookings Mountain West, a collaboration of Brookings and UNLV, found that employment levels in Las Vegas stagnated in the third quarter following two straight quarters of job gains.

Las Vegas topped the nation with a 2-point drop in its unemployment rate between the third quarter of 2010 and the third quarter of this year. The bad news is that Las Vegas as of September still had an unemployment rate of 13.6 percent, fourth worst among the nation's large metros.

Brookings senior fellow Mark Muro and senior research assistant Kenan Fikri, who co-authored the Brookings Mountain West report, wrote that there are signs of recovery in the Intermountain West, which the think tank identifies as Nevada, Arizona, Idaho, Colorado, Utah and New Mexico.

These signs include unemployment rates that are falling throughout the region and continuing recovery of economic output lost during the recession.

"The housing market, for its part, might finally have found a floor," Muro and Fikri wrote. "Despite all this, the road to recovery remains long and uncertain. Adverse economic shocks like a deepening of the debt crisis in Europe or insurmountable policy gridlock in Washington could derail the region's, and indeed the nation's fragile recovery."

A quick look at how Las Vegas ranked among the nation's largest 100 metros as of September in key economic factors shows just how far Southern Nevada needs to go to enjoy full recovery.

Among Brookings' findings:

* Las Vegas lost 13.4 percent of its workforce since the second quarter of 2007, fifth worst in the nation. The top metros averaged a 5 percent loss. Las Vegas has grown its labor force by eight-tenths of a percent since the end of last year, but that was only 69th best.

* Las Vegas added 5.7 percentage points to its unemployment rate over a three-year period, worst in the nation. The top metros on average added 2.9 percentage points.

* Las Vegas suffered a 12.7 percent drop in its gross metropolitan product since the second quarter of 2007, ranking 98th. The top metros averaged a 1.1 percent gain. Southern Nevada did experience a 1.6 percent gain since the end of last year but that was only good enough to rank 92nd, compared with a metro average gain of 5.1 percent.

* Las Vegas housing prices were still 64.8 percent below their peak in the fourth quarter of 2006, second worst nationally. The top metros averaged a 29.9 percent loss.

* Banks owned 11.22 of every 1,000 mortgageable properties in the Las Vegas metro area, ranking Southern Nevada worst in the nation. The top metros averaged 4.34 bank-owned residential properties per 1,000.

 

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