An economist speaking at the Economic Development Agency’s annual state of the economy luncheon last week said northern Nevada’s economy has much to celebrate even as recession looms — if it isn’t already.
A low unemployment rate, rising incomes and plenty of money flowing in the local economy are reasons for optimism and concern. So says economist Brian Gordon, who delivered the keynote address over lunch.
“We are now spending beyond our means. We spend more than we have on the doorstep,” he said. “That can be problematic.
“Is the sky falling already? I don’t think we’re there,” Gordon added. “But … obviously we have some concerns about what’s happening from a national perspective, don’t we?”
The local economy is influenced by national politics and federal interest rates.
“We’re seeing a general decrease in consumer debt service,” he said. “And from a business perspective, we’ve seen more revenue than we’ve ever seen in our lives. This contributes to what we are experiencing today, which is a slightly more stable environment.”
Gordon also said the economy is in recession. There’s a struggle to retain the workforce, in part because there are more jobs than employees available. This is due to retirements and job changers looking for more upward mobility and better jobs.
Consumer spending and borrowing are also returning to normal after the pandemic.
“People pass off like drunk sailors,” Gordon added. But this spending is beyond their means, so the debt is mounting.
Lunch was the celebration of EDAWN’s 40th anniversary. The group recruits companies to settle in the Reno area — including Fernley — that hire locals and pay decent wages.
EDAWN’s Mike Kazmierski said after Tesla announced plans to expand its Nevada operations to build electric trucks, the companies are delivering on their promises.
He cited Tesla as an example. Initial Gigafactory concerns about Tesla’s investments in Nevada have not materialized, he said. Tesla’s hiring and contribution commitments have been met and exceeded.
“We make huge tax revenues by lowering those taxes, letting them stay here, and letting them grow here. And Tesla is a great example,” he said. “The Gigafactory will phase out its incentives in 2024. When that is done. When you add that to their employee incentives, they add $125 million to the state economy through sales tax revenue and property tax revenue and other tax revenue that goes to the state. That’s money that wouldn’t be here if we hadn’t cut their taxes 10 years ago.”
Kazmierski encouraged the more than 1,000 people who attended the luncheon to ignore housing activists and NIMBYs.
He also urged support for the Truckee Meadows Public Lands Management Act — or land bill — and the Nevada Cares campus.
“For the activists who think it’s good to have camps everywhere, as opposed to a warm cares campus where it’s safe — that’s a very unsafe and very, very unhealthy environment,” he said. “If you look at these camps, I would ask any activist who has just spent a few nights in the camps and tell me it’s better than being on the Cares Campus.”