GOED Research Manager Steve Scheetz joins the show to discuss some of the big economic moves Nevada saw last year and what they might mean for the state in 2026.
Speaker 2 (00:00)
Welcome! You're listening to Diversify Nevada, a podcast produced by the Governor's Office of Economic Development. Diversify Nevada provides insightful discussions and expert analysis on the driving forces behind our state's economic, workforce, and community development. I'm Tom Burns, the Executive Director of the Governor's Office of Economic Development.
And we're your hosts, Evan Haddad and Carli Smith. Today we're joined by GOED's research manager, Steve Scheetz, who will give us a year-end review of economic development in Nevada. 2025 has been quite a year, and we wanted to get a fuller picture of what it meant for Nevada and where we might be headed in 2026. So Steve Scheetz, welcome back to the show.
Speaker 3 (00:46)
2025 is in the rearview mirror. From an economic development perspective, how would you describe Nevada's year in one word?
Speaker 1 (00:54)
Uneven. So yeah, in the first half of the year, it was pretty sluggish. I think, you know, coming off of the election and inauguration in January, there was a lot of confusion around tariffs and a lot of just political uncertainty and economic uncertainty across the board. And a lot of companies, especially those with heavy capital investments, were kind of in a holding pattern until things kind of shook out. And then, you know, in quarter three, we reported that, you know, we actually had quite a bit of pickup in our business development pipeline and things like that. And it looks like quarter four is shaping up to be that way as well. So.
Speaker 2 (01:37)
So to go off of that, us a picture of what 2025 was like for Nevada and lay out some possible scenarios for the coming year. Looking at the numbers, what do you think is going to be our biggest hurdle and what do you think will be our biggest asset?
Speaker 1 (01:51)
Yeah, so kind of going with that uneven theme. I think that you can't really talk about it without talking about what's going on nationally. When you look at some of those high and more traditional economic indicators, like the unemployment rate, GDP, the stock market, corporate earnings and things like that, everything on paper seems to be going really well. However, you you look at other indicators such as the Consumer Confidence Index, consumer debts, defaults are up, housing affordability concerns, things like that. Like, it's telling a very different story. So you kind of figure out what's going on, like, why is there a disconnect? And, know, I've heard recently a lot of economists talking about this kind of K shaped economy where, you know, the affluent, the the well to do's are doing quite well, and they're largely...
Speaker 3 (02:40)
Supporting the the lower half of the economy something like that.
Speaker 1 (02:47)
Yeah, mean, some statistics that I've seen is they nationally are responsible for about 50 % of the consumption countrywide and like the top 10%.
Speaker 3 (02:56)
What does that include in terms of household earnings, like the top 10 when you're talking about this K shape? What are the dollar signs there?
Speaker 1 (03:03)
You know, I don't have those hard numbers readily available to me. However, what I'll say is the defining difference between what you might think of as affluent or kind of that top 10, they tend to be asset holders versus non-asset holders, right? So kind of the lower end of the spectrum are more the W-2 workers, whereas the higher end of the spectrum, tend to own assets like stocks and property and things like that. I know that didn't answer your question. It kind of gives you an idea of kind of what we're looking at.
The reason I bring that up is that it also kind of translates to what we're seeing here in Nevada. So like a lot of our kind of top playing numbers show surprising resilience. You know, we still have a relatively low unemployment rate. Our employment stayed, you know, pretty steady. In fact, it's it's flat for the year. But, know, our gaming wins are up. We're continually hitting all time highs. But then also you look at the contrast in our visitor volume is down. Right. And housing affordability and the cost of living are both concerns.
And so that indicates to me again, kind of that, you know, well to do versus the rest of us, right? The gaming wins and things like that are largely concentrated in those, you know, higher affluent players.
And that poses some risks in the fact that, you know, the financial behavior of a smaller pool of people that are currently kind of propping up, you know, what we look at as these huge wins, you know, those could change on a dime. And then that really puts us in a kind of a precarious situation. Whereas a lot of the kind of value seekers and maybe domestic travelers that are coming over from, you know, California and things like that, they might be feeling a little pinched and therefore decide to maybe make more of a local destination vacation or forego that vacation altogether across state lines. that, know, kind of puts us in a touchy situation. As far as what you said for kind of what we have, like scenarios going forward in the coming year.
I think out of this last legislative session, especially with the housing bill that was passed, I think that housing affordability is going to be a major focus and I actually think that they're making tremendous strides in doing a lot of good in that regard. However, I do think that just generally both nationally and in Nevada, we're probably going to feel kind of this prolonged squeeze, right? Where it's not, you know, necessarily struggling, but I wouldn't say that the typical person's saying that their finances are thriving. Yeah. Right.
Speaker 2 (05:42)
Great. It's that high high low low thing again.
Speaker 1 (05:45)
Yeah, exactly. But when it comes to like our hurdles, again, that's kind of shrinking middle where
I've kind of beat that dead horse, but as far as our assets, the nice thing about Nevada is we have so much going for us. One of which being, you know, obviously we're a big landmass state. However, when you compare, you know, the size of our government and population, we're actually relatively small and then therefore that makes us very nimble. Also, you know, Vegas specifically, but Nevada as a whole, gaming industry is very dynamic. So while right now they might be catering to, you know, more of a high end clientele,
You know, they've proven decades upon decades that they're capable of shifting with the demand. So if they can sense that there's something on the horizon that they need to pivot their strategy, they have a whole host of resources at their disposal that they can do to kind of weather the storm. So I think that those two things are probably our biggest assets. Plus our economic development efforts to diversify Nevada are making tremendous strides. think that we've proven time and time again that we're able to attract a lot of investment to the state and build new industries. And, you know, just our proximity to, you know, some of our major ports, both the South and to the North. And then, you know, the I-80 corridor and the, I always forget the one in the South -- the 15? Running east-west, I mean, are typically within a day's drive, typically within that eight-hour window of like freight regulations.
Speaker 3 (07:21)
Meaning like if it's longer than eight hours, they have to like stop somewhere or something. So it's just like a little more of a Makes it a little bit more difficult to do logistics via truck or something. Like if you have to stop and go to sleep kind of thing.
Speaker 1 (07:32)
Exactly, that puts a huge strain on things. if you're taking things from the port and you have maybe an inland port or something like that available to you, some industrial park in which these materials can be distributed from those centers, that's a huge strategic advantage that we have as Nevadans. So we have a lot of assets at our disposal.
Speaker 2 (07:55)
You definitely painted the picture. Thank you.
Speaker 3 (08:03)
What kind of activity did we see in the business development pipeline in 2025? What were some of the big moves that took place this year?
Speaker 1 (08:09)
Yeah, kind of the same old story as the last couple of years. You know, we've been focused a lot on advanced manufacturing.
The tech sector, logistics, and more recently, I mean, it's been prevalent, but it's become more prevalent in our conversations recently, this alternative energy. And I think it might also be kind of more top of mind as we start to discuss some of the interest from data centers in the area. They're going to be obviously large energy consumers. And so naturally, you know, our state is poised well for...
For producing alternative energies to support that. So those are some of the trends that we've seen. You know, just for example, our advanced manufacturing of just the assisted companies that we deal with here in GOED. This does not represent the state of Nevada as a whole, but just the ones that we're aware of that we personally have dealings with. Our advanced manufacturing makes up about 40% of those assisted companies.
Some of our recent examples, we have in tech 21 % makes up that assisted companies profile. Examples of that one would be, recently we had PaySign come in. They're a fintech company that's also bringing 250 jobs into the Las Vegas area. And then logistics, course, 13 % of that mix. Another example might be Crocs. They're only bringing maybe 40 jobs. And I say only 40 jobs. There's still 40 families that are being fed that way. However, they're also bringing an $80 million investment to their distribution center. I mean, there's definitely revenues that we're going enjoy there. Alternative energy makes up a smaller proportion but it is making up an increasingly large proportion of those conversations and the interest that we're seeing.
Speaker 2 (09:55)
So to keep on the subject of jobs, what kind of job and wage growth have we seen this year from our assisted companies and what industries are these focused in?
Speaker 1 (10:05)
Right. So again, the assistant companies that we deal with, these are companies that we assist in some meaningful way. Right. So that's whether they're we're helping them by way of our office or our regional development authorities, helping them navigate the permitting process or acquire leases or land or
-- not just abatements --
Not just abatements, no, not at all. There's a whole host of ways in which we can assist them. But of those companies that we report on, our jobs for those assisted companies are down year to date, about 20%. However, when you look at, know, again, back to that first half of the year being very sluggish, we've made up tremendous ground just in the third quarter. We still have yet to report the fourth quarter just because of timing and stuff. But just in the third quarter alone, we gained 998 jobs of the 1,500 jobs year to date. In, know, fourth quarter is starting to kind of shape up that way as well. As far as your the wage question, year to date, we're up slightly about $3.51 at $36.30. And again, this is through quarter three, we still have yet to report quarter four.
But that's also a $4.73 above the statewide average wage, which sits at about, I think, $31.57 an hour. And so that's largely in part due to the types of companies that we're attracting, that we're focusing on our attentions on, being advanced manufacturing, tech, logistics, and alternative energies. Those tend to pay at the higher rate than some of their more hospitality-oriented jobs.
Speaker 3 (11:49)
And those are among our target industries, right? Most of those like logistics, advanced manufacturing, those are some of GOED's target industries, right? Yeah.
Speaker 1 (11:59)
And I think it should be noted too, a lot of the industries and the businesses we do help are mid to small size companies. They may not have all the utilities they need to kind of get up and running and so GOED is a good asset to kind of have in their toolkit.
Speaker 3 (12:11)
Let's talk about rural Nevada. What can we glean from your numbers or your insight into what this year was like for our rural communities?
Speaker 1 (12:20)
Yea you know, I like to focus on the rural communities. They might not necessarily get as much attention as you can imagine that, you know, those those quote unquote wins are fewer and far between. However, recently we've seen actually, you know, quite a lot of progress in those areas. Like, for instance, I wrote down a couple of examples in Churchill County. We recently had a company, a manufacturing company, Idaho Asphalt. They make concrete and construction materials. They're a manufacturer in Storey County, we have another distribution center, Trident Enterprises. In Lyon County, we have another really large solar project, again, kind of back to the alternative energy sector. Wells has been working with Amazon for, you know...
At least a year, if not more, trying to get things across the finish line. And they finally, you know, made movement on that and they established a new distribution center there or maybe it was an expansion in Wells. So that's great. You know, obviously in Nye, they have a really unique small business focus, which I really appreciate that have this kind of microloan program that's actually being really productive down there for some of these small businesses just to stand up in Nye County. Then Humboldt and Esmeralda County, you know, they're seeing a lot of activity around mining, kind of pick up steam with the lithium mines starting to kind of, they're not coming online for another couple years, but they're making a lot of progress in there, so.
Speaker 2 (13:56)
Yeah, and to keep up with businesses, you can't have businesses without a workforce. What trends did we see in 2025 and what are some of the most in-demand sectors for the workforce?
Speaker 1 (14:07)
Yeah. So statewide, as I mentioned before, it's pretty flat. In fact, I think it was only up maybe 0.1%, according to the BLS CES data.
And when you look at a lot of the graphs, when you kind of segment them out, we see, you know, kind of from the 2020 dip and then, you know, this rapid growth, but then towards in the in recent months, we've seen a lot of tapering, especially in some of those core industries that we talk about. In recent months, there are a couple of segments that we have seen some highlights, right, one of which being health care, health care is following a national trend. It's actually increasing pretty substantially. In this case, in recent months, we've seen a year over year, a three and a half percent increase. We've also seen increases in mining and education as well throughout the state.
Some of the lows that we've seen some of those segments include construction, which is down about 5 % year over year. And then retail and wholesale trade is also down. those are some of the trends that we're seeing. But one thing that I do want to point out is I actually before this call, I pulled a report looking at some of those five target sectors that we talked about in our economic development plan. And I pulled kind of a comparison report for Nevada compared to nationally compared to our seven Mountain West states and then those same seven states, but added Washington, Oregon and California, so all of our surrounding states. And in all three cases, across those five target industries being advanced manufacturing, tech, logistics operations, natural resources and technologies. this is a...
a mouthful, but hospitality, tourism, sports and creative industries, we've actually outpaced growth in all of those states. know, modestly, it's not massive, but you know, it's anywhere from 4 % to 6 % in the case of technology. some of these industries that we're focused on, we're actually having a palpable change in our growth and jobs there.
Speaker 3 (16:19)
Awesome. Before we wrap up, what's the most important message you like to leave our listeners with about Nevada's economic future as we look forward to this new year?
Speaker 1 (16:28)
I think I can sum it up in Nevada is resilient, right? We've shown the ability, as I mentioned before, to attract a lot of business investment and grow new industries. So while the headlines can highlight a lot of the very real risks that we do face, I actually think that Nevada is positioned to do very well in the years to come.
Speaker 3 (16:49)
Love it. Awesome. Well, Steve Scheetz, thank you so much for your time. I really appreciate it.
Yeah, thank you for being here.
Speaker 1 (17:01)
Great.
Thanks, it was so much fun.
Speaker 2 (17:20)
And that's all for this episode of Diversify Nevada. This podcast was created by the Governor's Office of Economic Development with the help of our sound editor, Michelle Rubble-Eddy. If you'd to learn more about our agency, can visit our website at goed.nv.gov. And if you'd like to share feedback about the show or suggest a topic you'd us to cover, send us an email to goed at goed.nv.gov. Thanks for joining us and we'll be back soon.