The weakening national economy has prompted pessimism among Las Vegas business executives about the local recovery, especially when it comes to hiring, according to survey conducted by UNLV.
The more pessimistic outlook for the third quarter comes after Las Vegas executives had expressed more optimism during the previous two quarters.
The business executives also remain pessimistic about a quick recovery in the real estate and construction industries in Las Vegas.
The survey released by the Center for Business & Economic Research listed the confidence level at 99.6 on its index for the third quarter. Any value below 100 means those surveyed are more pessimistic than optimistic about general economic conditions, sales, profits, hiring and capital expenditures.
“Perhaps because tourism, gaming and hospitality tie Las Vegas to the national economy, the mood at local businesses downshifted,” said Stephen Brown, the center’s director.
Some 34.2 percent of business executives said they expected the Nevada economy to improve in the third quarter while 24 percent expect it to worsen. The rest predicted no change.
The other positive is they expected sales and profits to improve in the third quarter. Some 33.8 percent expected an improvement while 27.6 percent predicted a decline in sales. Nearly 39 percent said there would be no change.
As for profits, 29.1 percent projected an increase, 26.6 percent expect falling profits and 44.3 percent expect no change.
What drove pessimism is the outlook for hiring, with only 9 percent forecasting an increase compared to 25.7 percent who said there would be a decrease. More than 65 percent forecasted no change in hiring.
When it came to capital expenditures, 17.9 percent projected an increase, 29.5 percent said it would decrease and 52.6 percent expected no change.
Business executives were more optimistic about the national economy than Nevada’s economy, even though the nation’s GDP increased only 1.8 percent during the first quarter.
Some 53.2 percent said they expected an improvement in the national economy while 17.7 percent expected it to worsen.
The Las Vegas real estate market won’t be improving soon, based on the latest survey results.
Some 77 percent said it won’t be until 2013 before home prices improve and most tilt to the second half of 2013. Thirty-three percent expect the price recovery in 2012.
In the construction industry, 86 percent said it won’t show improvement until 2013. Thirteen percent expect it in 2012 and 1 percent said it would be the second half of 2011.