Nevada By The Numbers: Where Do We Stand?

This past May, Reno was named the best place in the country to do business, according to Inc. Magazine. In March, Nevada was declared the nation’s most dangerous state by Morgan Quitno Press. In November, Time magazine named Governor Kenny Guinn one of America’s top five governors. There are ratings and rankings for every state in every category by more groups and organizations than any statistician could dream of. But these rankings and ratings are based on the subjectivity of the organizations doing the rankings or ratings, and the numbers used by these organizations are statistics. And statistics are not facts.

Most statistics, ratings or rankings are treated as parts of a wondrous numerical buffet. People and groups take the ones they like to prove their point and leave the others behind. Just like a buffet, there is a statistic to suit every taste.

With the fallibility of statistics firmly in mind, we take a look at Nevada by the numbers. Using a variety of sources and a variety of categories, these numbers offer a taste of the buffet.

Business Environment

Nevada is big on economic development and redevelopment. In fact, the last legislature allocated $10 million to these efforts. According to Governor Kenny Guinn, Nevada’s rate of job creation is four times higher than any other state’s. He attributes this to the work of economic development and redevelopment and Nevada’s “business-friendly” atmosphere.

Our privatized worker’s comp program (the only completely privatized program in the country) makes those rates cheaper than those paid in other states. The proactive small business hospital and medical insurance program keeps medical bills from pushing people into poverty.

The economic development incentive programs offered at the state level include the sales tax deferral program, sales tax abatement, sales and use tax abatement, modified business tax abatement, property tax abatement, property tax exemptions, Nevada Hub Zone development, Train Employees Now (TEN), property tax abatement for recycling/retail, green building abatements and renewable energy abatements.

Inc. Magazine’sMay 2005 issue ranked Las Vegas as the country’s fastest-growing city (not its first time). Reno was named best medium-sized city for doing business. Las Vegas was the second-best large city (behind Riverside-San Bernardino, Calif.) for doing business. Reno and Las Vegas were 63rd and 226th (out of 274) for the most balanced economy.

“We have to have a healthy, educated workforce,” Guinn said. “We are looking for companies that pay a living wage. Our economic development people are really selling the $15 to $20 an hour wage rate, where people can get insurance and help us all take care of those people who are less fortunate.”

More and more high-tech companies are moving to Nevada. A comparison of operating costs in different cities goes a long way toward explaining why. While average annual operating costs for a technology company (according to Boyd Co.) are as high as $12,126,308 in San Francisco, $11,312,531 in Los Angeles and even $11,044,286 in Sacramento, costs in Las Vegas are only $10,206,722. In fact, in a survey of 20 cities, only three had lower costs than Las Vegas.

Nevada also has its share of corporate headquarters. Again, costs paint the picture. In Boyd Company’s survey of costs to operate a corporate office in 30 cities, Las Vegas beat out 28 of those cities with low costs. It had annual operating costs of $14,170,886 per year compared to New York at $17,154,334, San Francisco at $16,654,593, Los Angeles at $15,968,015, Seattle at $15,093,130, Sacramento at $14,959,654 and Portland, Ore. at $14,474,743.

Taxes

One of the biggest selling points Nevada has in its arsenal to bring companies here is our tax package. Nevada has no corporate income tax, personal income tax, unitary tax, franchise tax on income, inventory tax, inheritance tax, estate and/or gift tax or special intangible tax.

The Commerce Clearinghouse State Tax Guide, Volumes 1 and 2 (2004) compared taxes imposed by western states and found the following:

Despite the boom in real estate in Northern and Southern Nevada, annual real property tax costs remain comparatively low. The Boyd Company estimated annual property taxes that would be assessed on a 350,000-square-foot light industrial building on a 20-acre, fully-serviced site. Its survey of 10 western cities showed Reno with the lowest property taxes ($253,231) and Las Vegas as the second lowest ($284,522). Compare this to the third lowest – Dallas – at $459,841. The numbers go up as one looks at Denver, San Diego, Portland, Los Angeles/Long Beach, Albuquerque, San Francisco and Phoenix (the highest at $611,010).

Employment

The U.S. Census Bureau listed 48,863 private non-farm establishments with paid employees in Nevada of 2001, employing 916,681 people. Occupational Employment Statistics from the Nevada Department of Employment, Training and Rehabilitation (DETR) list high-wage jobs. Nine out of 10 of the top wage-earning occupations were in the healthcare field (real estate brokers break up the list coming in at No. 9).

In coordination with the Bureau of Labor, DETR also put out Current Employment Statistics showing total non-farm jobs increasing 6.0 percent (from 1,185,400 in October 2004 to 1,256,900 in October 2005). The largest increase was in the category of construction (11.4 percent), while information jobs actually dropped (1.4 percent).

Nevada’s unemployment rate as of October 2005 was 4.0 (down from 4.1 last year). The national unemployment rate was 4.9.

The Nevada Employment Security Division lists Nevada’s average wage as $17.34 per hour, lower than the national average of $18.28 reported by the U.S. Department of Labor, probably due to the state’s large percentage of service-sector jobs. The Census Bureau (2003) rates Connecticut – with a median household income of $56,409 – as the top state for income. Mississippi had the lowest median income, at $32,397. Nevada ranked higher than the national average of $43,318 with a median income of $45,249. Washoe County posted $50,090, second in the state to Douglas County’s $53,207. Clark County’s median was $43,728 – below the state average, but above Mineral County’s low of $31,367.

Tourism

The Nevada Commission on Tourism (NCOT) tracks tourism in Nevada, which is sixth in the nation for international and domestic visitor spending. Tourism is a $40 billion industry in Nevada, and $11 billion of that is attributed to gaming revenue. Nevada has 17 of the 20 largest hotels (based on number of rooms) in the nation. Room nights occupied in 2004 were 54,381,114. Despite the large number of rooms available, in 2004, the average monthly occupancy rate was 89.7 percent, much higher than the national average of 61.8 percent.

Bruce Bommarito, director of NCOT, said that Nevada is the first and only U.S. entity to obtain a license to advertise and market in China, and Chinese visitors spend more per visit than any other overseas tourists.

While Nevada has fewer than 2.5 million people, it attracts 50 million visitors a year. Across-the-board comparisons to other states are not available, since each state seems to have its own system of counting visitors. “Nevadans are just welcoming,” Bommarito said. “We are doing our part to dispense with the image of the ugly American.”

Education

According to WestEd Center on Policy, in its report “Student Achievement and Graduation Rates in Nevada,” Nevada has experienced increases in enrollment of 5 percent to 7 percent (four times the national average) for 15 years. But while Clark County grows at staggering rates (from 190,822 students in 1997 to 283,245 in 2003-2004), Nevada’s rural counties are experiencing slower and even decreasing rates of enrollment.

The Nevada State Board of Education’s “Annual Reports of Accountability” for 2003-2004 listed a student-to-teacher ratio of 21:1, higher than the national average of 15.7:1 reported by the National Education Association.

The Board of Education reported Nevada’s dropout rate as 5.8 percent. The Kids Count Data Book lists Nevada’s high-school dropout rate (teens 16 to 19 who are not enrolled in high school or high school graduates) as 11 percent in 2004 (from 16 percent in 2000) compared to Arizona (11 percent), California (6 percent), Idaho (6 percent), Oregon (6 percent), Utah (5 percent), and Washington (7 percent). The national average was 8 percent. However, Kids Count monitors the number of teens who are not enrolled in school; the State Board of Education monitors the number of teens who formally drop out. The true figure is most likely somewhere between the two.

The U.S. Census of 2000 counted 80.7 percent of Nevada students graduating from high school, close to the national average of 79.6 percent. While 18.2 percent of Nevada’s high school graduates go on to receive their bachelor’s degrees, the national average is 23.8 percent.

The Kids Count Data Book gives Nevada education an overall ranking of 32 out of the 50 states for 2002-2003 (up seven spots from 1999-2000). Most of our neighbors did better – California ranked 17, Idaho 16, Oregon 18 and Utah 9 – while Arizona came in at 41.

Healthcare

According to the Nevada Hospital Association, Nevada has 1.52 doctors per 1,000 people (3,616 total), compared to the national average of 2.4 doctors per 1,000 people reported by the Henry J. Kaiser Family foundation. Nevada’s 24,188 licensed nurses amounted to 5.48 nurses per 1,000 people, compared to the national average of 7.9 nurses per 1,000. There are 50 hospitals in Nevada (38 acute care, five rehabilitation, seven psychiatric) and 674,855 emergency room visits per year. Approximately 19 percent of Nevada’s population is uninsured (compared to a 16 percent national average).

The February 2005 issue of “Governing, The Government Performance Project” included in its “Success Stories” section that the mental health department budget in Nevada increased by 31 percent with a new 150-bed state hospital. However, the ratio of social workers to clients was still 1 to 30 or 40 (the generally recommended ratio is 1 to 17) even though the 2001 Legislature appropriated money to bring it down to 1 to 28. Nevada has only six state hospital beds for every 100,000 people (the national average is 33).

Despite the improvement in funding, the report gave Nevada a grade of B– overall, primarily because of worker shortages, especially for nurses, social workers, mental health professionals, occupational therapists, speech therapists, physical therapists, rehabilitation counselors, engineers and IT workers).

Land Use

At 70,264,320 acres, Nevada is the seventh largest state in the union. “The Reno-Sparks Chamber of Commerce Relocation and Visitors Guide 2005” lists the state as being made up of 110,450 square miles (485 miles long, 315 miles wide). Almost 87 percent of that is federally owned, according to “Public Land Statistics 2000”, published by the Bureau of Land Management, the largest percentage in any state. The national average is about 24 percent.

Nevada is the No. 1 gold producer in the country, responsible for 76 percent of the nation’s gold, and third in the world (behind South Africa and Australia). Nevada has more mountain ranges than any other state and around 50,000 miles of paved road. The U.S. Census lists Nevada as having only 18.2 people per square mile, most of them crowded into the state’s southern tip.

Population

The U.S Census Bureau estimated Nevada’s 2004 population as 2,334,771 and reported it grew 16.8 percent between the 1990 census and the 2000 census, faster than the national growth rate of 13.1 percent. As of the 2000 Census, 7.3 percent of Nevada’s population was under the age of 5, 25.6 percent was under 18, and 11 percent was older than 65. Males and females were pretty evenly distributed (49.1 percent female to 50.9 percent male) and most of the state (75.1 percent) is white (all of which similar to the national average). Foreign-born people were 15.8 percent of our population, and 23.1 percent of us spoke a language other than English at home.

Cost of Living

According to the American Chamber of Commerce Researchers Association’s (ACCRA) second quarter 2005 report, the composite cost-of-living index for Las Vegas was 113.9 (13.9 percent above a national average of 100), and for Reno it was 112.1. Compare this to 95.5 for Boise, Ida. (4.5 percent less than the national average); 98.1 for St. George, Utah; 103.0 for Denver, Colo.; 109.3 for Flagstaff, Ariz.; 115.6 for Portland, Ore.; 116.5 for Seattle, Wash.; and 153.0 for Oakland, Calif.

A comparison of housing costs for eight western cities by ACCRA in its Cost of Living Index (2005) showed Las Vegas as lower than San Francisco and San Diego in the average price of a three-bedroom home, but higher than Seattle, Denver, Reno/Sparks (which came in as 6th-highest of the eight), Portland and Phoenix. The cost of a new 2,400- square-foot home on an 8,000 square-foot lot was $374,286 in Las Vegas and $300,189 in Reno. The picture for rent is a little different, with the average monthly cost of a two-bedroom apartment being $780 in Las Vegas (sixth highest of the eight) and $858 in Reno (fourth highest).

Electric bills for Nevadans are lower than our neighbors’. According to Sierra Pacific Resources (Winter, 2005), Edison Electric Institute Standard electric bills for Las Vegas and Reno/Sparks were lower than those for the Los Angeles area, San Francisco Bay area, and San Diego area for residential, commercial and industrial users, with Reno having higher costs than Las Vegas.

An often-overlooked cost of living in a society is crime. The Federal Bureau of Education, Uniform Crime Statistics 2003 compared regional crime rates in the United States. Arizona’s per-capita crime rate led the 11-state Southwest region at 6.7 percent, followed by Nevada and New Mexico at 5.5 percent each. However, when it came to sheer numbers of crime, Nevada was sixth for the region at 123,639. California led the pack with 1,626,188 and sparsely-populated Wyoming recorded only 19,276 crimes.

Instruments of Change

Nevada is a fast-growing, dynamic state filled with dichotomies and distinctions. It takes a lot of people in a few organizations to try and keep the state on a steady course. Some of the major chefs preparing Nevada’s buffet include: City of Reno Redevelopment Agency, City of Sparks Redevelopment Agency, Clark County Redevelopment Agency, Nevada Commission on Economic Development, Economic Development Authority of Western Nevada, Nevada Development Authority, Northern Nevada Development Authority, the development authorities in most of the rural counties, State of Nevada System of Higher Education, Chambers of Commerce and all the government entities (from DETR to the governor’s office to city councils).

As Joel Kotkin, author of “The City: A Global History (Modern Library) and “The Best Places for Doing Business in America 2005” (Inc. Magazine, May 2005), said, “Nevada has a good product to sell, which always helps. It will be interesting to see what happens over time.”