After a long hiatus, our blog is back. We will return to publishing our Northern Nevada leading and industry indices, as well as other relevant economic data on this blog. In the meantime, find what you missed on our website:
Brian Bonnenfant, Center for Regional Studies at UNR, and I did a presentation this morning for the Northern Nevada Network. The presentation focused on an overview of the economic performance of the Reno MSA, including a look at historical economic indicators, including taxable sales, gaming revenue, visitors, single family home sales, home prices, employment, wages, and more. The presentation also considered future population and employment projections and issues in the region associated with this growth. A copy of the presentation is included below:
Economic indicator data published in our previous blogs is useful in understanding changes occurring in each individual area, but do little to provide a picture of the overall economy and its changes over time. Economic indices, which combine multiple indicators into a single number, can represent either the current state of the economy (coincident index) or future economic changes (leading index), providing a clearer picture of the economy and its trends.
Ekay Economic Consultants, Inc., in cooperation with the Center for Regional Studies at the University of Nevada, Reno, is pleased to announce the release of its Leading Economic Index and Coincident Economic Index for the Reno MSA area. The indices are referred to as RLI and RCI, respectively. Latest results of the two indices are summarized below, along with a graph of their historic changes. For more details about index indicators, values, and methodology, please click here.
-Reno MSA Leading Index (RLI) increased between September and October 2015 (0.48%), indicating expected growth in the regional economy over the next 6-12 months. This is the 41st consecutive increase in the index since May 2012.
-Reno MSA Coincident Index (RCI) increased between October and November 2015 (0.24%), (most recent data), verifying that the current economy continues to expand.
Center for Regional Studies (CRS) at the University of Nevada, Reno recently released an update of employment and wage information for the Reno-Sparks MSA and Washoe County (the difference between Reno-Sparks MSA and Washoe County is that the MSA includes both Washoe and Storey counties).
A graph summarizing employment data for the Reno-Sparks MSA is shown below. Due to seasonal fluctuations in monthly employment data, it is important to compare employment for the same month over multiple years. As December typically has the highest levels of employment, the below graph emphasizes results for December months across the study period (2006 to 2014). The highest level of December employment was in 2006 at 228,100 employees. December employment fell by over 36,000 jobs to its lowest point in 2011 (191,500). The MSA reached the highest level of December employment since the recession of 204,800 in 2014, gaining over 13,000 jobs between 2011 and 2014. While we are still approximately 23,000 jobs below the December 2006 level, this trend is encouraging. As of June 2015, year to date average employment increased by 4,700 jobs (2.4%) over the same period in 2014.
In terms of income and wages, CRS reported data for Washoe County on an annual basis between 2006 and 2014. The below graph shows countywide median household income peaked at $57,392 in 2008, before declining to $49,026 in 2012. Median household income is estimated for 2014 at $54,727, an 11.6 percent increase over 2012 levels and a 4.6 percent decrease since 2008.
Average wages in Washoe County increased from $39,520 in 2006 to $44,980 in 2014, growing steadily over this period, with a total increase of 13.8 percent. While this is positive, wages are reported in nominal terms, unadjusted for inflation. Consumer price index for All items, West Size Class B/C as reported by the Bureau of Labor Statistics increased by 14.8 percent between 2006 and 2014. This indicates that wages are increasing at a rate below inflation. While this discrepancy still exists, it is lower than the difference between 2006 and 2013 wage and inflation growth. During this period, wages in Washoe County increased by 11.4 percent, while inflation increased by 13.3 percent, a difference of almost two percentage points. The difference decreased because for the first time since 2009, Washoe County wage growth in 2014 exceeded inflation, with wages increasing by 2.1 percent between 2013 and 2014, compared to inflation increase of 1.3 percent.
As discussed in the previous blogs, Education and Health Services was the only Washoe County sector to gain employment between 2007 and 2011. This is a diverse sector, incorporating various educational and medical industries. This entry takes a closer look at the industries making up the Education and Health Services sector to determine the exact areas where job growth occurred.
The table below shows, based on employment information provided by the Nevada Department of Employment Training and Rehabilitation, that a number of industries within this sector experienced employment growth, while some saw job losses. This is expected due to the diversity of the Education and Health Services sector and why this type of a detailed analysis is important.
The Other Schools and Instruction industry had the highest percentage growth over this period at 41%, gaining 166 jobs. Offices of Physicians gained the highest number of jobs at 296, though this resulted in only an 8% growth rate.
The Medical and Diagnostic Laboratories industry lost the highest number of jobs, 232, and had the highest percentage of job decreases, 37%. Overall, all educational industries for which data was provided showed an increase in jobs between 2007 and 2011, while health-related industries showed job losses and gains.
It should be noted that the above job estimates are provided on an industry basis, not occupational basis. Job estimates are provided by industry, regardless of the occupations within these industries. That is, for example, jobs within the Offices of Physicians industries will include all employees within that industry, including physicians, nurses, receptionists, janitors, etc.