The recent recession has had a significant impact on the retail industry. Taxable retail sales, main measure of industry performance, fell by $7.4 billion between their peak in FY 2005-06 of $26.1 billion and $8.7 billion in FY 2009-10, a drop of 28. Employment decreased from 139,000 in FY 2007-08 to 127,000 in FY 2009-10. These decreases not only hurt those associated with the industry, they impact the public and private sectors of the entire State. Sales tax revenue, which funds operations for the State, local governments, school districts and special projects, declined from a total of $2 billion in FY 2005-06 to $1.5 billion in FY 2009-10, the impact lessened by the increase in sales tax rates in most counties.
Other revenues generated by the retail industry, have also been reduced, including local payments for property and business-type taxes and fees, as well as State and Federal taxes. This decrease in revenues, without a comparable decrease in government services (police, fire, EMS, schools, etc.) makes it difficult for State and local governments to balance their budgets and continue providing the same level of service as prior to the recession.
In addition to the impact of the recession on the public sector, the private sector was also impacted outside of the retail industry. A decrease in employment compensation, proprietors income, and other property type income by the retail industry impacted the entire State, reducing total industry impacts by over $2 billion. Industry employment and jobs supported by industry operations decreased by 46,000 jobs between FY 2005-06 and FY 2009-10. The retail industry lost almost 36,000 jobs between FY 2005-06 and FY 2009-10, with 38% of these jobs lost in the sales and related occupations, 19% in installation, repair and maintenance occupations and 15% in office and administrative support occupations.
Overall, the retail industry remains an important industry in the State of Nevada, it is still the fourth largest industry in terms of employment and one of the few industries that grew due to regional factors during this recession period. Local and State governments depend heavily on sales tax revenue and employees on retail jobs. Despite the decline during the recession period, it is likely that the industry will recover to continue its important role in the State of Nevada economy.
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