The Stat Pack
The RCG Jobs index 12-month moving average (“12MMA”) for Clark County increased 0.1 points between August and September to 96.6 and is up 1.2 points compared to September 2014. The index is steadily moving upward as the Valley’s “headline” jobless rate continues to drop. The peak of 99.8 occurred in December 2005.
The 12MMA in Clark County’s headline unemployment rate did not change in September, remaining at 7.1% compared to August, but it was down 1.1 percentage-points compared to September 2014. However, the region’s Y-0-Y job growth rate declined 0.2 points to 3.2% compared to August, and was down 0.5 points compared to September 2014. The most recent spate of growth peaked at 3.9%, and it has declined for six of the last seven months. However, this is not necessarily a bad sign since the job growth rate is expected to slow as the economy moves toward equilibrium.
The Nevada U-6 unemployment rate fell to 14.8% in Q3, 2015, down 0.4 points since Q2. The U-3, or headline rate, declined by 0.2 points. While this rate is improving, the state’s overall job market (because of Las Vegas) continues to face headwinds compared to the rest of the nation. The Nevada U-6 rate is 1.2 points behind second-worst state, Arizona. In terms of the U-3 rate, Nevada continues to rank last. It was 50th of the states in Q3 trailing #49 West Virginia by 0.1 points.
Construction jobs in Southern Nevada (Las Vegas MSA) numbered 49,750 in September (12MMA), representing a jump of 5,650 jobs (12.8%) compared to September 2014. Construction activity continues to pick up. Jobs in this sector have now grown for 38 straight months and we hear that the construction industry is having trouble finding workers, especially skilled workers. Southern Nevada construction jobs 12MMA peaked at 108,833 in November 2006.
On a 12MMA basis, Clark County visitor volume rose in September compared to August, to 3.49 million. And it was up 2.6 percent Y-O-Y. We are confident that Southern Nevada’s visitation numbers will continue on a generally upward trajectory for the rest of the year.
Clark County convention attendance increased 1.7% in September compared to August (on a 12MMA basis), to 447,682. And convention attendance to Southern Nevada rose by 2.2% from September 2014. This is the highest mark since February 2009. This said, the general trend appears to be increasing at a less than optimal rate.
The 12MMA hotel revenue per available room (RevPAR) in Clark County rose by $1.15 in September compared to August to $102.62. RevPAR is up 2.8% compared to September 2014 and continues its steady progress. However, the rate of growth has been slowing over the year. Note: RevPAR is a performance metric in the gaming and lodging industry. It is computed by dividing a gaming resort’s total hotel room revenue by the room count and the number of days in the period being measured.
September’s 12MMA gaming revenue (net of baccarat) of $688.1 million decreased 0.11% compared to August ($688.9 million), but was up 2.6% relative to September 2014. That makes five months of Y-O-Y growth of at least 1.5%. These are the first consecutive months of such growth since May 2012 (13 months). Net of baccarat revenues are largely comprised of slot revenues, which generally reflect typical gaming spending of average Americans. Slot revenue growth continues to be challenged for two reasons: constrained disposable income and changing spending patterns, especially among adults under 35.
Total (new and resales) Clark County September home sales (closings), which numbered 4,111 (12MMA), rose by 9.4% from September 2014. Resales saw a 9.4% Y-O-Y jump in September to 3,565, while new homes sales increased 9.5% to 546. This marked three straight months of rising Y-O-Y new home sales after 14 months of declines – a good sign for the region’s plodding housing recovery.
According to Home Builders Research, the 12MMA median home price (new and resale) for September was $201,283, an 8.2% jump over September 2014. The median new home price was $304,816, up 4.6% in the last 12 months. The median resale home price was $185,299 in September, reflecting a 9.2% increase during the last 12 months. – a good sign for the region’s homeowners, developers and brokers, but may be not so much for first time homebuyers. The Reno average resale price for September was much higher at $273,889.
The combined rate of home appreciation for new and resale homes has slowed considerably during the last year. In September 2014, the Y-O-Y price increase from September 2013 was 14.5%. But, it has slowly picked back up after bottoming out at 5.5% growth in April 2015.
Mirroring the slowdown in home sales over the last year, the 12MMA 30-year fixed rate mortgage in the Western Region was down to 3.80% in October. This rate will remain relatively low as the Federal Reserve continues to try to stimulate consumer and business spending and demand, and while inflationary pressures remain low.
The 12MMA Case-Shiller home price index for the Las Vegas MSA reached 139.8 in August, an increase of 6.6% compared to August 2014. This was about one-third of the 20.5% increase recorded between August 2013 and August 2014. These increases are similar to those reported by Home Builders Research.
The prime rate remains at 3.25%. However, The 10-year treasury bond rate has increased in the last month, from 2.07% to 2.23%. The 90-day LIBOR remained 0.33. Lender rates were split, though. Also, compared to three months ago, the 90-day LIBOR is up significantly. While, these rates remain historically low, they, and the loan spreads, have increased significantly over the last month.
Taxable retail sales in Nevada and Clark County continue to rise, thanks to increased visitation and consumer spending. Taxable sales hit $3.16 billion in August, up 6.3% compared to August 2014, on a 12MMA basis. Retail sales figures are now higher than the pre-recession highs of 2007 and continue to be encouraging for future state and county budgets. Steadily improving local, regional and national job markets are key to this improvement. This is especially true regarding the regional and national job markets since they are primary drivers of tourism spending in the region.
Las Vegas MSA 12MMA average weekly earnings (not inflation-adjusted) in September rose to $719, a 3.0% increase over September 2014. On an inflation-adjusted basis, weekly earnings are starting to improve, as well, up 2.7% in September compared to September 2014, to $638 in 2007 dollars. The inflation adjusted peak of $751 occurred in August 2007.
On a 12MMA basis, the number of weekly hours worked in Las Vegas (Clark County) in September held steady at 33.2 hours for the fourth straight month, but was down 0.3 hours from the 33.5 recorded in September 2014. As we’ve noted, stagnant and even dropping average hours worked have accompanied a dropping headline unemployment rate. At this point in the recovery, Reno is beating Las Vegas.
Implication: Companies continue to depend heavily on part-time workers. For this reason, the U-6 unemployment rate (includes discouraged and part-time workers) in Nevada remains the nation’s highest at 14.8%.
According to AAA, as of November 2, the average price per gallon for regular unleaded gasoline dropped by 10.1%, from $3.10 a year ago to $2.78. Between October 2 and November 2, the price of unleaded also declined, by $0.20 per gallon, or 6.8%. We expect gas prices to remain less expensive compared to last year through the end of 2015.
Electric meter hookups’ 12MMA in August reached 776,848, up 2.0% over August 2014. The annual growth rate has been fairly steady recently, but this marks the first time that growth has hit 2% since December 2007. This hints at increased population growth, household formations and business expansions in the Valley.
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