The Stat Pack
In August 2018, the RCG Employment Index’s 12-month moving average (“12MMA”) for Reno-Sparks increased by 0.1 points to 99.5. While the Index has been increasing at a slower rate, it continues making progress closer to the all-time high. The Index is up 0.7 points since August 2017. It peaked more than 12 years ago in December 2005 at 99.8 aka 100.0. The trough of 89.6 occurred in January 2010.
Reno-Sparks job growth dropped 0.1 points between July and August, from 4.5% to 4.4% on a 12MMA basis. The rate of growth is down 0.4 points from the 4.8% recorded in a year ago in August 2017. The lowest rate of growth in the last 10 years happened in December 2009 (-9.3%). The region’s previous record 12MMA high was in August 2016 when jobs grew by 4.9%.
The 12MMA headline unemployment rate fell 0.1 points to 3.8% in August. When compared to the August 2017 headline rate of 4.5%, this August’s rate was 0.7 percentage-points lower. Reno has reached unemployment rates seen before the Great Recession.
There were 88,267 construction jobs in Nevada in August 2018. 17,100 (or 19.4%) of those jobs were in the Reno-Sparks MSA (12MMA). This is a jump of 5% from the 16,292 jobs reported in August 2017, and the second consecutive month of significant job growth for the area. Reno’s very healthy economy has produced strong residential and commercial real estate demand, but also has led to a housing shortage and certain types of commercial space, especially industrial.
The latest stats show that 7.7% of the region’s payroll job-base is in construction. Construction jobs in the Reno-Sparks MSA peaked at 24,042 in August 2006 on a 12MMA basis. Current construction jobs are at 71% of the peak. At the time of the peak, the industry accounted for 11.1% of all jobs. The large number of jobs in the construction sector was a consequence of the pre-Recession real estate bubble. The sector bottomed out in February 2012 when there were only 8,792 construction jobs.
The annualized visitor count for Washoe County decreased 0.67% from July 2018 to 5.09 million in August. Despite a YOY visitation growth rate of just 0.4%, Washoe County continues to outpace growth in Clark County, which had a visitation contraction in August of -1.8%.
Early in 2016, Washoe had been lagging behind Clark in visitor growth, but the tables have turned with YOY visitor growth rates in Washoe beating those of Clark every month since June 2016 for the reasons noted in the Clark County Stat Pack section.
Washoe County has now seen YOY growth in visitor volume every month since January 2015, at an average annualized rate of about 3%. The 12MMA peak occurred in May 2004, when 467,904 visitors came to Washoe. The highest annual growth rate happened in January 2013, when visitor volume grew 5.8%. Despite earlier challenges, the Reno-Sparks hospitality industry has made important gains and continues to grow stronger.
Washoe County’s 12MMA YOY gross gaming revenue grew by 6% in August 2018, and is up 0.66% from the previous month. This leaves total revenue at $71.9 million. In comparison, Clark County saw a YOY growth rate of .8% this August. The YOY growth rate for Washoe County has been positive for more than 3 years straight at an average of 3.3%, corresponding to a similar growth streak in visitor volume.
Gaming revenues peaked nearly 12 years ago in June 2006 at $89.4 million, and the county is now at 80% of that peak. On an annual growth rate basis, the peak of 5.5% happened 12 years ago in May and June of 2006.
Washoe County’s economy continues to benefit from rising taxable retail sales. In July 2018, the 12MMA growth rate was 6.9% YOY, an increase of 0.6 points from July 2017. The YOY growth rate has remained essentially flat over the last 4 months. Taxable retail sales reached $715.1 million in July on a 12MMA basis, having already surpassed the previous peak (March 2016) on a nominal basis (not inflation-adjusted). Washoe’s taxable sales growth rate is 2.5 points higher than the statewide average.
Job growth, success in business attraction and retention, resulting in construction activity plus proximity to the Bay Area and the Pacific Northwest, are driving the region’s economy, though increasing visitation has also contributed.
The 12MMA of the nominal average weekly wage (not adjusted for inflation) in the Reno-Sparks MSA grew about $6 (or 0.77%) in August 2018 over the previous month, to $823. This marked the 14th consecutive month of growth. On a YOY basis, this wage is up 3.9% from $792 in August 2017.
The inflation-adjusted (real) 12MMA wage for August 2018 of $693 is up almost $4 from the previous month’s wage, and is $9 (0.77%) higher than the wage recorded 12 months ago. Reno-Sparks workers are starting to see real wage growth pick up after more than a year of relative stagnation.
In July, the region’s average weekly earnings were 3% higher than the Las Vegas average of $672. Reno-Sparks’ real wage has fallen considerably from the $730 peak in May 2016, just over 2 years ago.
In August 2018, the Reno-Sparks MSA’s 12MMA average weekly hours worked remained at the previous month’s 35.3 hours. Weekly hours worked appear to be leveling off some after trending down since October 2017. Conversely, weekly hours in Las Vegas seem to be leveling after trending slowly upward. On a YOY basis, 12MMA weekly hours for Reno-Sparks are down 0.6 points from August 2017. The most recent weekly hours worked peak happened in July 2009 at 36.8 hours, while the trough of 32.5 hours happened in September 2014.
The average price per gallon for regular unleaded gasoline in Reno-Sparks as of Sep 23, 2018 was $3.44, up $0.04 (1.1%) from $3.40 the previous month. When compared to the previous year, the price of regular unleaded is up $0.43 (14.3%). Gas prices have been rising steadily and could impact resident and business spending in other areas of the local economy.
According to AAA, “The September switch-over to winter-blend gasoline ushered in cheaper gas prices compared to the summer, but that drop was short lived. Crude oil accounts for half of the retail pump price and crude is selling at some of the highest price points in four years. That means fall and year-end prices are going to be unseasonably expensive.
Motorists in the West Coast region are paying the highest prices for retail gasoline in the country, with six of the region’s states represented in the nation’s top 10 most expensive list. Hawaii ($3.84) is the nation’s most expensive market, followed by California ($3.80), Washington ($3.44), Alaska ($3.33), Oregon ($3.29), Nevada ($3.27), and Arizona ($2.91). All prices in the region have increased on the week, with California (+7 cents) leading the way. Nevada increased five cents, while Hawaii and Washington each increased four cents.
The EIA’s weekly petroleum status report showed West Coast gasoline stocks increased slightly to 27.89 million bbl during the week that ended on September 28. Stocks are approximately 760,000 bbl lower than where they were at this time last year, which could lead to price volatility if there are any supply shocks in the region this week.”
Per the World Gold Council, in September the 12MMA month-end spot price for an ounce of pure gold fell by about $8 (0.6%) from August to just over $1,275. On a YOY basis, the 12MMA price of gold is still up 2.4%. The peak of $1677.77 occurred in December 2012. Despite the dips in recent months, the YOY growth rate has generally trended upward for 2 years, and is up for the last 10 months straight.
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