The U.S. economy entered 2026 with modest growth but with mixed signals from several key indicators, along with ongoing geopolitical uncertainty. Real Gross Domestic Product (GDP) increased at an annualized rate of 1.4% in the fourth quarter, a slower pace than expected, bringing full-year growth to 2.2%. Employment also declined unexpectedly in February, losing 92,000 jobs. The unemployment rate edged up by 0.1% to 4.4% from the previous month. Inflation remained unchanged in February, as the Consumer Price Index (CPI) and Core CPI increased 2.4 and 2.5%, respectively, from last year. January retail sales were down by 0.2% month-over-month, but up by 3.2% from last year. Auto and truck sales in February also decreased by 1.4% year-over-year. The U.S.-Israel war with Iran contributed to a more uncertain economic outlook, disrupting oil markets and increasing inflation pressures. The Brent crude oil futures market projects a peak of $99 per barrel by May 2026, falling into the $70 per barrel range in 2017.
Nevada’s economy presented mixed signals. Seasonally adjusted employment lost 500 jobs in December. The unemployment rate stood at 5.2%, improving from 5.8% one year earlier. Taxable sales increased strongly by 7.4% year-over-year. In contrast, tourism-related indicators weakened. January gaming revenue declined by 6.5% from a year earlier, while air passenger traffic fell 7.3% during the same period.
Clark County experienced similar trends, with continued weak performance in tourism activity. Employment added 2,000 jobs from the prior month but decreased by 0.8% from a year ago. The unemployment rate remained at 5.6%, down from 6.0% one year earlier. Taxable sales in December rose by 2.0% year-over-year. Residential permits also increased by 34.4% year-over-year. Tourism indicators, however, declined. January gaming revenue fell by 7.8% from last year, and visitor volume and air passengers also decreased by 2.5 and 7.8%, respectively, over the same period.
Washoe County posted mixed, but somewhat more positive economic signals. Employment declined 0.2% from the prior month and was 0.3% below last year’s level. The unemployment rate remained at 4.5%, down from 4.9% a year earlier. Taxable sales in December continued a strong gain, increasing 33.3% year-over-year. January gaming revenue and visitor volume rose by 4.2% and 12.3%, respectively, from a year earlier. Residential permits, however, declined by 38.0% year-over-year.
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.
