Las Vegas Recovery Leaps Forward Moderately

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9-2 LV Employment

The RCG Employment Index’s 12-month moving average (“12MMA”) for Clark County increased by 0.1 points between June and July, and 1.5 points compared to July 2014. The index is steadily moving upward as the Valley’s “headline” jobless rate continues to drop.

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9-2 LV Job Growth

The 12MMA of Clark County’s headline unemployment rate remained level at 7.2% in July compared to June. It was down 1.4 percentage-points compared to July 2014. The region’s year-over-year (“Y-0-Y”) job growth rate also remained unchanged at 3.5% compared to June, and to July 2014. The most recent spate of growth peaked at 3.9% in February.

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9-2 Construction job

Construction jobs in Southern Nevada (Clark County) numbered 48,825 in July (12MMA), representing an increase of 5,525 jobs (12.8%) compared to July 2014. Construction activity continues to pick up. Jobs in this sector have now grown for 37 straight months on a Y-O-Y basis.

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9-2 LV Visitor

On a 12MMA basis, Clark County visitor volume rose in July compared to June, up to 3.47 million. It is up 2.6 percent year-over-year. The ongoing jump in visitor volume has continued relatively unabated since July 2009. We are confident that Southern Nevada’s visitation numbers will continue on an upward trajectory for the rest of the year.

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9-2 LV convention

Clark County convention attendance declined in July on a 12MMA basis, to 429,587. This represents a 2.4% decline compared to July 2014. Monthly convention attendance has been between 420,000 and 440,000 for the last 17 months. The general trend is less consistent today than it has been.

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9-2 Hotel rev.

The 12MMA hotel revenue per available room (RevPAR) in Clark County increased $0.28 in July compared to June reaching $101.88. July’s RevPAR was up 3.0% compared to July 2014 and continued its generally steady progress. 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.

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9-2 LV Gaming rev

July’s 12MMA gaming revenue (net of baccarat) of $685.3 million increased 0.17% compared to June and was up 1.7% relative to July 2014. That makes three months of Y-O-Y growth of at least 1.5%. These are the first consecutive months of such growth since October 2012. Net of baccarat revenues are largely comprised of slot revenues, which generally reflect typical gaming spending of average Americans. However, slot revenues remain moribund for two reasons: constrained disposable income and changing spending patterns, especially among adults under 35.

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30 yr

Mirroring the slowdown in home sales, the 12MMA 30-year fixed rate mortgage in the Western Region was down to 3.85% in August. This rate is expected to remain relatively low, but could rise if the Federal Reserve decides to increase rates in September.

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9-2 LV weekly earnings

Clark County 12MMA average weekly earnings (not inflation-adjusted) in July rose to $712, a 2.2% increase over July 2014. On an inflation-adjusted basis, earnings are starting to improve, up 1.6% in July compared to July 2014, to $632 in 2007 dollars, marking 13 months of improvement.

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9-2 LV Hours

On a 12MMA basis, the number of weekly hours worked in Las Vegas (Clark County) was 33.2 hours in July, unchanged from June, and 0.3 hours less than the 33.5 recorded in July 2014. As we’ve noted, stagnant and even dropping average hours worked have accompanied a dropping headline unemployment rate.

Implication: companies continue to depend heavily on part-time workers. For this reason, Nevada’s U-6 unemployment rate (includes discouraged and part-time workers) in Nevada remains the nation’s highest at 15.2%.

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9-2 LV Fuel

According to AAA, as of August 28, the average price per gallon for regular unleaded gasoline dropped by 13.4%, from $3.69 a year before to $3.19. Between July 28 and August 28, the price of unleaded also declined, by $0.08 per gallon, or 2.3%. We expect gas prices to stay relatively stable and less expensive compared to last year through the end of 2015.

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9-2 LV electric

Electric meter hookups’ 12MMA in July reached 775,595, up 1.8% over July 2014. The annual growth rate has been fairly steady for 18 months, bouncing between 1.3% and 1.9%. This corroborates the population growth projections for the Valley.

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9-2 LV Employment-permit

A well-known housing market indicator is the employment-to-housing permit ratio or E-P Ratio. The E-P ratio for Clark County was 4.2 in July, on 12MMA basis, compared to 5.2 in July 2014. According to the general consensus, an E-P Ratio above 2.0 that is relatively steady indicates that the local housing market is healthy.

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