Image by Alexander Schimmeck

Diversified
Economy

Image by Alexander Schimmeck

In February 2020, unemployment dropped to just 3.6 percent; but a month later, Gov. Sisolak ordered all non-essential businesses to close costing Nevadans over 280,000 jobs and spiraling the state into the worst economic recession since 2008.

The recession was a faster, larger drop than the Great Recession. And while recovery began much sooner during this economic crisis, Nevada has a long road ahead.

The 2020 recession highlighted differences in Nevada’s economies. For example, from the statewide high of 30.1 percent unemployment in April, northern Nevada was one point below the national average of 7.6 percent in October. Southern Nevada still stood at 13 percent.

 

In February, economic variables like gaming revenue, visitor volume, hotel occupancy rates, taxable sales and employment were only at roughly half (50%) of historic February peaks. While some experts do not expect any kind of resolution until 2024, a few economists believe Nevada will return to economic norms by 2022.

 

April’s historic 30.1 percent unemployment rate began to fall when business closure orders began to lift. Approximately one-third of employees returned back to work immediately while another third has begun returning to their jobs as the economy has started to stabilize. But the last third is going to continue to operate at a 70 or 80 percent economy for the rest of 2021, at least in southern Nevada.

Northern Nevada has a more diversified economy; travel and tourism still flourish, but tech and data centers, industrial parks catering to distribution, logistics and manufacturing bolster the diversity in northern parts of the Silver State.

Northern Nevada also serves as a quasi-suburban business hub to the Bay Area and the Pacific Northwest, thereby providing Nevadans with higher quality jobs and a higher quality labor force than the skilled workers in the hospitality industry. The critical point is that those skills need to change.

For the 2021 school year, there are 363 public schools serving 328,328 students in Clark County School District. The District's public schools have an average math proficiency score of just 33 percent and an average reading proficiency score of a mere 46 percent. These low numbers do not produce a work force that can operate in skilled industries like tech, healthcare, and mining–three of Nevada's most essential industries (outside of hospitality).

Nevada’s high school graduation rates slipped for the Class of 2020 after several years of steady gains, according to data from the Nevada Department of Education released Thursday. The statewide rate dropped 1.5 percentage points, from a record 84.1 percent in 2019 to 82.6 percent in 2020.  Clark County, the state’s largest public school district and the fifth-largest in the country, saw a 2.6 percentage point decrease, falling to 83.1 percent from last year’s rate of 85.8.

 

Despite this decline, the Nevada legislature recently passed SB178, which new funds are meant to reach low-performing students at all schools that aren’t part of the Zoom or Victory programs, which serve English-learner and impoverished students. It amounts to $1,015 per student who scores in the bottom quartile of certain tests, like the 2019 SmarterBalanced Assessment in Language Arts or Mathematics for third through eighth graders. While it may sound beneficial, the law now reduces numerous high school budgets by up to $600,000.

As a policy, we need to be investing in our state's children by providing school choice and higher quality education. In a competitive society and an economy driven by tech, healthcare, and mining industries, Nevada must dedicate effort to education, which in turn is an investment into our state's future economy. Otherwise, our work force will be unable to diversity and our earning capabilities will be diluted by outsourcing or consumed by residents out-of-state or those incentivized to move to Nevada due to vacancies unable to be filled by current state residents.