Southern Nevada Economic Recovery Expected to Take Another Two Years, UNLV Economists Say

Data Compiled by Center for Business and Economic Research Forecasts Slow Recovery in Business, Tourism and Construction Sectors

LAS VEGAS, June 23 /PRNewswire/ — The business, tourism and construction industries of Southern Nevada are expected to make slow economic recoveries within the next two years, according to data compiled by economists at the Center for Business and Economic Research (CBER) at the University of Nevada, Las Vegas. At its mid-year economic outlook conference Tuesday, CBER Director Keith Schwer said Southern Nevada will likely lag behind the rest of the nation’s financial progress because the Las Vegas economy is a one-industry consumer-based system which is experiencing a slump in the housing and construction sectors, an unemployment rate above the national average and a decrease in visitors to Las Vegas.

“Southern Nevada’s economy is dependent upon discretionary spending. In an economic downturn that’s the first type of spending that will be cut back. We need to be prepared for a sharper downturn that you might ordinarily expect in other more diversified economies. Economic diversification is one of the recommendations from this report,” said Keith Schwer, director of the CBER. “Las Vegas is a destination resort so the critical factor for our economy to recover quickly would be a global economic rebound and then the U.S. economy picking up.”

Among the economists’ findings:

• Construction will be slow and unemployment will likely increase causing more foreclosures. Unless population growth occurs, a slump in the Las Vegas housing market could continue until 2011.
• The opening of new leisure and hospitality properties will grow jobs; however, until consumers are confident about their job prospects, they will remain cautious about spending on discretionary items like leisure travel.
• Leisure and hospitality properties will market low-cost packages in the form of room and entertainment deals, thus the tourism industry is expected to begin to recover before the housing market, but it will not be enough to improve hotel and casino revenue streams in the short term.
• Further job losses are expected in the construction, housing and tourism industries even when the economy picks up.
• Keith Schwer’s comments: http://www.youtube.com/watch?v=qzwYj6YUf4Y
• Information on the CBER at UNLV: http://cber.unlv.edu/.

UNLV is a doctoral-degree-granting institution of 28,000 students and 3,300 faculty and staff. Founded in 1957, the university offers more than 220 undergraduate, masters and doctoral degree programs. UNLV is located on a 350-acre campus in dynamic Southern Nevada and is classified in the category of Research Universities (high research activity) by the Carnegie Foundation for the Advancement of Teaching.

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SOURCE University of Nevada, Las Vegas