LAS VEGAS (KTNV) — For decades the hospitality, gaming and tourism industry has been and will likely continue to be the valley's largest industry. But as we've seen, that leaves us especially vulnerable to massive disruptive events like the great recession, 1 October and most recently the pandemic.
DIVERSIFYING ECONOMY
As part of our series Meadows to Metropolis, 13 Action News anchor Todd Quinones examines the challenges and successes of diversifying our economy.
As many as 60,000 bottles can be processed every day here at Lucky Jack Cold Brew Coffee. The Nevada Built company at Lake Mead and Nellis, ships out coffee across the country.
THE CHALLENGE
But there's a challenge. They need to hire all kinds of engineers to maintain this equipment.
"So you need good smart people here with a lot of knowledge... If you go to an industrial town they are plentiful. In an entertainment town, gaming, hospitality town there is a shortage of them," says Lucky Jack CEO, Ray Cole. "So what do you do in that case?" asks Todd. "Well you know, we have outsourced some things from all over the country," says Cole.
EDUCATION
This is just one example of the hurdles that come with diversifying Nevada's economic base.
"The problem is that you just don't become an engineer. You're going to be trained and that's a higher education degree. We're expanding the education engineering schools. But it takes a while once that pipeline starts and you get people in it to get them back out of there," says Gov. Steve Sisolak.
NECESSARY WORKFORCE
During an extended interview with 13 Action News, Gov. Sisolak didn't shy away from the challenges for Southern Nevada to diversify our economy. Achieving that largely depends on getting other industries to relocate here.
"What do these companies tell you why they're not coming to Nevada?" asks Todd. "One of the big reasons is workforce and education. You know, we don't have the workforce to meet a lot of their needs... There's still some concern even about our K through 12 system there that we're just not ranked high enough and they want a good place for their employees and their executives to be able to send their kids to school," says Gov. Sisolak.
COST OF LIVING
Any CEO looking to relocate also has to consider the cost of housing for their employees.
"The big sell for Southern Nevada for a long time is, 'hey you can come here and it's cheap to live.' That's not necessarily the case anymore," says Todd. "It's not at all the case anymore here. Absolutely right. And I am troubled. I'm troubled by that... You are pricing an entire generation out of the homeownership market," says Gov. Sisolak.
UNEMPLOYMENT
The challenges are great. But the need to overcome those challenges may be even greater.
Take a look at this chart provided by Local Area Unemployment Statistics on DETR's website. The blue line is Nevada's unemployment rate at the height of the pandemic. It soared to nearly 30%. The highest in the country. The national average in orange was half that. This is the very definition of a boom or bust economy that is tied to tourism and gaming.
"We need to have businesses that will be able to keep this economy running, keeping people employed," says Gov. Sisolak.
TAX BREAKS
Sisolak points to tax breaks or abatements as being one carrot that has lured some businesses here, along with thousands of jobs.
"We've got several autonomous vehicles, Nuro, the one that you see sometimes the pizza ads on TV. This vehicle and no driver delivers pizza out there, there. We've got a big facility at the speedway and they're manufacturing," says Gov. Sisolak.
SOLAR ENERGY
Solar energy also carries some promise of becoming something southern Nevada could export.
"I was briefed on the situation at UNLV, where they now have the technology that they developed that for going from point A to point B. There's a power loss, there's an energy loss, but they've come up with a way to transmit it, that there is no energy loss, which is really revolutionary scientific developments, which is going to help us there," says Gov. Sisolak.
MARIJUANA INDUSTRY
Also promising, our marijuana industry had more than $1 billion in taxable sales in the last year. And there's a big push by the different chambers of commerce and the Las Vegas Global Economic Alliance or LVGEA to lure businesses here.
LURE BUSINESS
That includes Cubicall. The California start-up, seen on ABC's Shark Tank, makes portable enclosed cubicles for businesses that offer privacy in open-concept offices. The brothers who own it were looking to move. Nevada, Florida and Texas were on the list of possibilities. Then the LVGEA stepped in.
"We didn't even make the decision yet to move here, and they brought us to lunch to go meet the mayor of North Las Vegas," says Anthony Pucci of Cubicall.
In the end, Sisolak says it likely won't be one major industry that will help stabilize the economic base of the valley. But rather a collection of small to mid-size companies that see promise in our metropolis.
