The Calm Before the Storm

Posted on September 28, 2007
Filed Under Construction, Gaming, Union, Job Growth, War for Talent |

Perfect Storm
Las Vegas is  currently experiencing the ‘calm before the storm.’  As we watch unemployment levels rise to their highest levels since post 9-11, employers are building confidence that the War for Talent is shifting in their favor.  To some extent, they are correct.  For now. 

But let me be very clear about this - there are rough waters ahead.  What Las Vegas will experience in the next 5 years will be the “Perfect Storm.”  Over 200,000 jobs will be created across all industries.  To validate this projection - Deutsche Bank Securities recently authored a report that shows 113,500 jobs being created in the casino industry alone.  And according to their findings, even at our current rate of 8,000 new residents moving in, if this migration is not accelerated, 25,000 of these jobs will go unfilled.

Now to put all of this job creation into perspective……. The State of Nevada (because of Las Vegas’ growth) has been the fastest growing State in the union for 18 consecutive years.  No other state has ever grown at this rate.  Well - in the next five (5) years, we will experience twice (2x) the amount of job growth as the last ten (10) years combined.  That is double the job growth in half the period of time.  And during the last 10 years, we have consistently had one of the lowest unemployment levels in the country. 

Let’s add another perspective - from a real-estate point of view.  There currently are close to 23,000 homes on the MLS; more than Las Vegas has ever experienced.  Those homes make up only 11.5% of what will be needed to house all of the families of the 200,000 new employees expected to move to Southern Nevada.  In 2005, the hottest year in the real estate market in Las Vegas, 39,000 new homes were sold and 58,522 resale homes changed hands - mainly because of investor ‘flipping.’

That means we will ultimately need to build more housing, which means more job creation in the construction industry.  With $24 Billion in construction occurring on Las Vegas Boulevard alone, there will be a fierce War for Talent for commercial construction employers who have been enjoying the slow down in the residential markets as many of these laborers have helped fill vacancies.

So, enjoy the Calm Before the Storm.  It will not last long.  Maybe another 6-9 months.

Comments

2 Responses to “The Calm Before the Storm”

  1. rafael310 on September 28th, 2007 12:17 pm

    As always, it is very insightful to read the articles you post on this website and I very much enjoy your weekly newsletter as a whole. As an ‘about to relocate and migrate’ to Vegas professional, all of the information you provide helps give me a more panoramic impression of the Las Vegas employment trends and landscape. I really appreciate all the hard work that goes into it. See you in a month! - Rafael

  2. Las Vegas is sliding into a recession…. : Recruiting Nevada on February 15th, 2008 10:39 am

    […] As I stated in a previous post, this is just “The Calm Before the Storm.” […]

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