1. Southern Nevada Compensation and Benefits Association May 14, 2008
Economic Update
Southern Nevada Compensation and Benefits Association
May 14, 2008

2. Has LV Housing Reached a Bottom?

3. Las Vegas Housing Prices January 1987 to December 2003 January 2000 = 100

4. Las Vegas Housing Prices January 1987 – March 2008

5. Las Vegas Housing: Current and Trend Estimates
177.2
($233K)
126.7
($160K)
January 2000 = 100

6. Doesn’t Look Like a Bottom Yet
Current Deficit (previous chart) more than 30%
Remainder of 2008 with declining values
But, if doesn’t look like it will return to the linear trend of the past
Inflation outlook
Strong job growth with Strip openings in 2009

7. Is LV in a Recession?

8. What is a Recession?
“Probably Not”

9. What is a Recession?
“Probably yes, a mild long recession”

10. What is a Recession?
“Yes deep, but short”

11. A Recession Requires “clearly present” downturns
Depth
Duration
Across most economic sectors
U.S. recession
Media: Two quarters decline in GDP
Official: NBER

12. A Look at the Previous U.S. Peak
“Looking for a Downturn”

13. Previous Six Recessions
Employment Declines?
2001 Peak
Previous Six Recessions
Broken Line
Months Prior to Peak
Months Following Peak

14. Industrial Production?

15. Manufacturing and Trade Sales?

16. Real Personal Income?

17. Peaks and Troughs Identification after the fact
The last downturn declared eight months later
First quarter 2008 GDP growth slightly positive
Jobs turned down January 2008

18. Is Las Vegas in a Recession?
What do the Data Show

19. Unemployment Rates Going Up

20. LV Unemployment Rate
below 2001 level

21. Down, but No Depth

22. No Discernible Peak

23. Down of Recent and Below Forecast by Nevada

24. Flat, but Hard to See a Downturn?

25. But Some Job Sectors Weak
For some it is a recession, for others it is a no growth

26. Construction Jobs Peaked

27. Job Outlook Weak national economy, perhaps a recession
Most likely a mild recession and a weak recovery
Las Vegas economy generally marks time
Job growth with the openings along the Strip in last half of 2009.