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Updated: 3:59 AM Mar 18, 2010
Our Recovery Lags: Unskilled Workforce Blamed
The West is finally starting to recover economically, but Nevada is stalled. Economists say a big reason is our reliance on industries that didn't require a greater investment in education.
Posted: 7:30 PM Mar 17, 2010Reporter: Ed Pearce |
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For decades there's been a pattern of migration to the West, a movement that fueled our growth and fed two major engines of our economy construction and tourism.
This recession has hit both hard and, according to a study released by the Brookings Institution and UNLV, that's what's made this recession different and makes Nevada's recovery problematic.
The report says in other recessions, the mountain west has fared relatively well. Growth continued, jobs were created. Nevada was especially recession resistant, it's unemployment rate usually below national averages.
Not this time and nowhere is the problem worse than Nevada.
Our public policy has long relied on low taxes to attract business. University of Nevada Reno economist Dr. Elliott Parker says the flip side of that decision is that we haven't made the investments other states made that now leave us poorly equipped to climb out of the recession.
"We're not investing in infrastructure to allow us to be a leader in alternative energy and we're not investing in education. In fact, we're cutting back in those areas because we don't have the cash."
We've relied heavily on two industries that haven't demanded a greater investment in education--construction and tourism.
The recession has left us with a large inventory of empty residences and commercial properties. That will delay a full recovery of the construction industry.
Tourism depends on a customer base with disposable income, now in shorter supply.
Other areas around the mountain west, says Parker, are in better shape.
"In metropolitan areas that are recovering like Denver and elsewhere, they're recovering based on their education workforce. We've been depending on not having an educated workforce in the past and it's worked for us. But at this point what we're seeing is Nevada is an outlier. The rest of the mountain states are starting to recover. In Nevada's case the good news is only that we've stopped declining."
The good news? Other than things are leveling off, it's hard to find. Parker says, however, northern Nevada may be a little better off than Las Vegas since our gaming industry flattened out years ago, forcing more diversification.
"But we're still following the same model Las Vegas followed and we still have huge housing declines and depend on growth in a way that is unsustainable."
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