The “second” estimate of U.S. real gross domestic product (GDP) for the first quarter of 2020 experienced a strong gain of 6.4 percent at an annual rate, remaining unchanged from the previous estimate. Downward revisions in net exports and private inventory investment offset upward revisions in consumer spending and nonresidential fixed investment. Overall, the strong recovery in the first quarter was largely boosted by federal stimulus funds. May job gains grew the leisure and hospitality sector by an additional 292,000 jobs, benefitting from recent vaccination successes. Signals of a labor shortage emerged as average hourly earnings increased by 0.5 percent from last month. Retail sales in April skyrocketed by 51.2 percent year-over-year as the U.S. economy stalled in April 2020 due to the COVID-19 outbreak. The most recent data indicate that the U.S. economy is experiencing a strong recovery, while constrained labor and materials markets and the large uptick in inflation raise some concerns about the ongoing recovery.
Nevada’s economic activity posted highly positive signals based on most recent monthly data. Seasonally adjusted statewide employment gained 8,400 jobs in April, and the unemployment rate edged down from 8.1 to 8.0 percent. March taxable sales posted a record high, benefiting from federal stimulus spending, while gasoline sales (in gallons) remained lower than the pre-pandemic peak.
Clark County also displayed strong signs in its local economic activity. Seasonally adjusted employment added 8,400 jobs in April. Although April gaming revenue decreased by 3.1 percent from last month, it was robustly up by 7.0 percent from April 2019. April total McCarran Airport passengers barely budged from last month, but visitor volume soared by 14.8 percent during the same period. March taxable sales jumped by 34.3 percent month-over-month, recording the second highest level, largely thanks to the federal stimulus spending. Although residential housing permits/units in April fell by 9.3 percent month-over-month, its level remained at a high level.
Washoe County exhibited mixed signals in its local economic activity. The Reno-Sparks unemployment rate climbed to 4.9 percent from 4.4 percent in April. March taxable sales, however, were up strongly by 39.4 percent from March 2019. April gaming revenue posted a strong month-over-month gain of 5.2 percent, remaining 32.8 percent higher than the level from April 2019. April residential permits/units were only down by 0.6 percent month-over-month.
Stephen M. Miller, Director Jinju Lee, Economic Analyst UNLV Center for Business and Economic Research
The views expressed are those of the authors and do not necessarily represent those of the University of Nevada, Las Vegas or the Nevada System of Higher Education.