Nevada State BankElko Quarterly Briefing
Q3 2020
Economic Update
While Nevada has been particularly hard hit by the current recession resulting from the COVID-19 pandemic, the Elko area has weathered the storm far better than the major population centers like Las Vegas and Reno. Elko County’s unemployment rate peaked at 14.0 percent in April 2020, while the statewide unemployment rate reached 30.1 percent for the month and Clark County’s rose as high as 34.0 percent. Since that peak, Elko County has seen a steep decline in unemployment, with the rate measuring just 5.0 percent for July 2020. While still well higher than the 3.1 percent unemployment rate recorded in July of 2019, it is a much more stable number than seen throughout much of the state.
Employment figures have rebounded significantly across the state as the economy has begun to reopen following the initial shutdown of many businesses in the wake of COVID-19, and Elko County employment grew by 3.3 percent just from June to July. However, there are indications that the recovery may be slowing down statewide. After three straight months of declining initial unemployment insurance claims, claims increased by 39.4 percent in July. With recent announcements from companies such as MGM Resorts International (the state’s largest employer) that they will be laying off many previously furloughed employees, additional spikes may occur.
One particular bright spot in Elko County has been consumer spending, which has remained strong despite the pandemic and subsequent shutdowns of many businesses. In June, taxable retail sales in Elko County totaled $151 million, 6.9 percent higher than May’s total and 16.4 percent greater than in June of 2019. In fact, taxable retail sales in Elko County have shown year-over-year growth in every month during the current recession with the exception of March when shutdowns were first ordered. Gross gaming revenues also recovered quickly once casinos and other gaming operations were allowed to restart business in June. Elko County gaming revenue in June was only 2.3 percent below revenue from June 2019, and July gaming revenues were only down 5.3 percent year over year. This compares to year-over-year declines of 45.5 percent and 26.2 percent statewide in June and July, respectively.
Mining and Agriculture Update
The mining sector of Nevada’s economy has been a standout success story so far during the pandemic, defying the trends that seem to be dragging almost every other industry down. Statewide mining employment reached 12,500 in July, the highest number on record, and 17.9 percent above the recorded level in February, the last month before the recession began. This has been aided by record increases in the price of gold, one of the Nevada mining industry’s most important and precious minerals. Gold traded at above $2,000 an ounce for several days during August, and ended the month with an average price of $1,969 per ounce, 23.7 percent higher than the March average. Much of this run-up has been fueled by investors seeking less volatile sources of wealth as many remain unsure about the future of the broader economy and how long the recovery from the current recession may take.
Ranching and farming employment declined in Elko County for the third straight quarter in the first quarter of 2020, prior to the effects of the COVID-19 pandemic. Despite the declining employment, total wages in the sector remain high, as the trailing 12-month total through the first quarter remains 10.8 percent higher than the same period one year ago. This marks the fourth straight quarter of double-digit percentage gains in total wages for the sector.
Q2 2020
Economic Update
The second quarter of 2020 has been one of historical significance for the global and U.S. economies. As the COVID-19 pandemic has halted the longest uninterrupted stretch of economic growth in the country’s history, Nevada has been particularly hard hit, and is experiencing the highest unemployment rate in the country. While Elko County has reported significant job losses of 24.9 percent year over year through April, the region has fared better than the state as a whole. This is partly due to the area’s relative lack of dependence on the tourism industry, the state’s biggest economic sector, which is heavily concentrated in Nevada’s two main population centers in the Las Vegas and Reno areas. Elko County’s unemployment rate rose to 15.7 percent in April, well below the 28.2 percent recorded statewide and the 33.5 percent rate recorded in Clark County.
Elko County may not be as reliant on tourism and gaming as much of the state, but the impact of casino closures has still been significant. In February 2020, Elko County recorded $27.5 million in gaming revenue, and the trailing 12-month total reached a record-high of $318.4 million. In March, with casinos being shut down mid-month, Elko recorded just $14.9 million in gaming revenue. April saw gaming revenue all but disappear in Elko County as gaming revenue totaled $6,104.
Most data currently lag behind the effects of the COVID-19 pandemic and economic shutdown, which has turned into the fastest-onset recession in American history. Taxable retail sales through March showed only a minor year-over-year decline in Elko County, as some stockpiling and panic-buying of goods offset the closure of many stores. When data for April and May become available, it is expected that both months will show more significant declines. However, as the economy begins to open up further through the beginning of summer, these declines could reverse and support a rebound in employment and consumer spending.
Mining and Agriculture Update
Mining has been less affected by the COVID-19 pandemic than many of Nevada’s industries, as it was not among the “non-essential” businesses that were shut down starting in mid-March. Mining employment in Nevada remained steady through April 2020, measuring 10,800. The mining industry’s latest available wage data released in the fourth quarter of 2019 showed the average weekly wage rise 14.5 percent over the year. Total mining wages for the quarter reached $309.8 million, a 16.0 percent rise from the prior quarter and 13.4 percent higher than one year earlier. Due to mining’s lack of interruption, any declines in average or overall wages during the first two quarters of 2020 are expected to be lower than those experienced in other industries.
The mining industry has also been aided by some of the financial market volatility brought on by the COVID-19 pandemic, as investors have sought out more stable stores of wealth. Between February and May, the price of gold increased 7.4 percent and eclipsed $1,700 for the first time since 2012. The increased price of gold has helped major mining stocks avoid the declines of the broader markets, as both Barrick Gold Corporation and Newmont Corporation have recorded increases since the major stock indices peaked in February. If metals prices continue to increase as the economy begins to rebound, it could bode well for Nevada’s mining industry in the coming months.
The agricultural sector in Elko County is holding relatively steady, although most available data does not yet cover the period when the effects COVID-19 might be noticeable. The price of hay increased from $179 per ton to $183 in April 2020, and is up from $180 year-over-year. The latest available employment data for the ranching and farming industry from the fourth quarter of 2019 shows a 12.1 percent decline year-over-year, but wages in the industry have remained strong. Through the fourth quarter of 2019 the trailing 12-month total of ranching and farming wages in Elko County increased by 17.2 percent.
Q1 2020
Economic Update
Nevada’s economy has maintained its growth trend in recent months and continues to exceed national averages in numerous metrics even as some growth rates have begun to slow. Through December 2019, Nevada employment grew 1.9 percent year-over-year, ranking 10th among all states and outpacing the national employment growth rate of 1.4 percent. Employment growth in Elko County has lagged the rest of the state, however, reporting 0.9 percent annual growth through December 2019. Despite slower employment growth, Elko County’s unemployment rate has continued to decline and remained one of the lowest in the state at 2.6 percent in December 2019.
The state’s prolonged period of job growth combined with the declining unemployment rate has created a tight labor market that has impacted both the pace of job creation and wage growth. As of the third quarter of 2019, the average weekly wage in Nevada was $973, 4.1 percent higher than the prior year. In Elko County, average weekly wages have grown 5.8 percent over the year to $1,011. The overall strength of the economy and tightening labor market have also meant less turnover in employment. The trailing 12-month total of initial unemployment claims declined to just over 118,000 in January 2020, the lowest level since 1996 despite Nevada employment growing by nearly 600,000 during that time.
Through November 2019, the trailing 12-month total of taxable retail sales in Elko County had increased 2.9 percent to $1.58 billion, a rate less than the statewide 6.1 percent growth rate and well below the county’s recent peak of 7.6 percent earlier in 2019. Gaming revenue growth performed stronger in Elko County than Nevada as a whole, as year-over-year growth in the county’s trailing 12-month total through December 2019 measured 5.1 percent compared to 1.7 percent across Nevada.
Mining and Agriculture Update
The price of gold has rallied significantly in recent months, rising to an average of nearly $1,600 per ounce in February 2020, the first time since 2013 that gold prices have reached such a level. The recent rise is fueled in part by increased volatility in the broader financial markets, compelling many investors to seek more stable stores of value. While the increasing price of gold has been a boon to Nevada’s many mining operations, preliminary reports from Barrick Gold Corporation, Newmont Corporation and Kinross Gold Corporation, the state’s three largest gold producers in 2018, indicate that total Nevada gold production for 2019 may have declined slightly for the second year in a row.
Several ongoing mine expansions and explorations point to increased expansion and stability for the industry going forward, however. The Nevada Gold Mines joint venture intends to continue exploration around its Carlin mine project, and multi-million-ounce deposits have been found at the Goldrush and Fourmile locations near the Cortez mine. Goldrush is expected to begin producing by the end of 2021, and Fourmile should follow a few years later.
Workers in Elko County’s agriculture and ranching industry had a strong year in 2019, apparently benefitting from the tight labor market. Through the third quarter of 2019, the trailing four-quarter total of wages in the sector reached $9.1 million, a 45.8 percent increase from one year prior. Overall employment has remained steady, leading the average weekly wage in the sector to nearly double from $542 during the third quarter of 2018 to $1,049 in 2019.
Q4 2019
Economic Update
Nevada’s economy continues to show solid growth, although various metrics indicate that growth is slowing compared to previous years. Year-over-year employment growth in Nevada dropped to 2.2 percent in October 2019, the first time the growth rate has slipped below 3 percent since March 2018 when it registered 2.9 percent. Elko County has recorded nearly identical employment growth over the past year, with a year-over-year increase of 2.1 percent in October. Elko County’s growth comes amid a much tighter labor market, however, as the county’s unemployment rate measured 2.7 percent in October compared to the statewide rate of 4.1 percent. Elko County’s unemployment rate is a record-low for the county and marks just the second time that Elko has recorded sub-3 percent unemployment rates in consecutive months since measurement began in 1990.
The tight labor market in Nevada has contributed to rising wages throughout the state, including Elko County. During the second quarter of 2019, weekly wages in Elko County averaged $1,014, an increase of 4.6 percent from the same period in 2018. Both the wage level and annual growth exceeded statewide figures, with second quarter wages averaging $961 per week after increasing 3.3 percent year-over-year. The increase in average wages, combined with greater overall employment, has led to consistent growth for the total wages earned in Elko County, which in the second quarter of 2019 measured $252.6 million, 6.4 percent more than the prior year. The trailing four-quarter total of Elko County wages shows even greater growth of 7.3 percent.
While wages and incomes continue to rise in Elko County, measures of consumer spending have shown more modest growth or even stagnation. Elko County’s trailing 12-month total of taxable retail sales grew just 2.3 percent year-over-year through September 2019, compared to 6.6 percent growth statewide. Gross gaming revenue in Elko County registered growth of 4.4 percent for the 12 months ending in October 2019, well above the statewide growth rate of 1.6 percent but a significant slowdown from 2018 when growth rates were consistently above 7 percent. Statewide housing prices, once leading the nation in the rate of appreciation, have also shown a significant slowdown in growth as sales volume has decreased and many have been priced out of the market. For the third quarter of 2019, the Federal Housing Finance Agency’s Home Price Index for Nevada showed year-over-year growth of 5 percent; during the third quarter of 2018 this growth rate was 14.8 percent.
Mining and Agriculture Update
The price of gold remains elevated, providing a boon to Nevada’s numerous mining operations. Gold averaged roughly $1,472 per ounce in November 2019, down slightly from averages of $1,495 in October and $1,510 in September but still good for 20.9 percent growth year-over-year. Taxable retail sales in the state related to mining continue to show better-than-average growth, with the trailing 12-month total through September 2019 measuring $284.7 million, an increase of 9.3 percent from the prior year.
Nevada Gold Mines Limited, the new joint venture between Barrick Gold and Newmont Goldcorp, became official in July 2019 and reported its first combined financial statements at the end of the third quarter. The joint venture reported gold production of 535,000 ounces, representing the combined production of the Carlin, Cortez, Turquoise Ridge, Phoenix and Long Canyon mines.
In other industry news, Maptek, an international leader in technical services for the mining industry, recently opened a new office in Elko to better serve the high concentration of mining operations in Northern Nevada. Maptek provides a number of services and software applications for mining exploration and operation, and currently works at nearly 50 mine sites in Northern Nevada. The office is just Maptek’s second location in the United States and reflects Northern Nevada’s important position in the global mining industry and the region’s positive
economic outlook.
Q3 2019
Economic Update
Long-term economic trends in Elko County remain largely positive, following the trajectory of the rest of the state in most respects. As of July 2019, employment in Elko County had increased by 1.6 percent year-over-year. While this is roughly half of Nevada’s nation-leading 3.1 percent employment growth rate, it is nearly identical to the national average of 1.5 percent. Despite the increase in employment, Elko County’s unemployment rate increased from 3.3 percent to 3.4 percent over the year as a result of a growing summer labor force. Even with this slight increase, the county’s unemployment rate remains one of the lowest in Nevada, tied for second behind Esmeralda County’s 3.1 percent rate and sitting well below the statewide rate of 4.5 percent.
The trailing 12-month total of taxable retail sales in Elko County has now shown positive growth for 18 straight months, reaching a total of nearly $1.6 billion in the 12 months through June 2019. The 4.0 percent growth for Elko County in the past 12 months trails statewide taxable sales growth of 6.0 percent, however, Elko County has not been aided by the same level of population growth experienced in other parts of the state.
Gross gaming revenue, another measure of consumer confidence and spending levels, has grown far faster in Elko County than the rest of the state. For the 12 months through July 2019, gross gaming revenue in Elko County measured $307.1 million, an increase of 5.7 percent from the prior year. Statewide, gross gaming revenue increased just 1.1 percent. Growth in both gross gaming revenue and taxable sales are due in part to greater earnings in Elko County, where total wages earned have increased by 8.0 percent over the past four quarters, a function of both employment growth and a 4.8 percent increase in average weekly wages over the same period. The combination of a steady job market and rising incomes should support continued growth in these key consumer spending measures.
Mining and Agriculture Update
Gold prices have increased sharply over the past couple of months, in part as a reaction to volatility in global stock markets and uncertainty associated with other investments. During May 2019, the average price of an ounce of gold was $1,284. In August that average increased to $1,499, growth of 16.8 percent in just three months. By the end of August gold was selling for more than $1,500 an ounce, the first time since 2013 that gold prices have reached such a level.
Nevada’s gold production remained relatively flat in 2018, declining by 1.1 percent from 2017 for a total of 173.6 metric tons. Production of other major minerals also declined slightly during the year, with silver production falling by 5.5 percent and copper off 0.8 percent from 2017 totals. Similarly, mining employment across Nevada has declined 4.3 percent over the past year, with roughly 11,100 people employed in the industry as of July 2019.
In September 2019 the Bureau of Land Management is holding an auction of leases for geothermal exploration on 50,000 acres of land northwest of Wells in Elko County. Nevada is one of the few states with geothermal power plants, and in 2017 produced 20.7 percent of the United States’ total geothermal power output, second only to California. Should these leases lead to the discovery of viable geothermal sites, the development of new power plants could help to further diversify Nevada’s energy portfolio and help the state take advantage of a unique natural resource.
Q2 2019
Economic Update
Like most of the state, Elko County’s economy continued to grow in the second quarter of 2019. Long-term employment continues to trend upward, with trailing 12-month average employment growing by 0.6 percent in April 2019. The unemployment rate decreased to 2.9 percent, down from 3.1 percent at the same time last year. Elko County’s unemployment rate remains one of the lowest in the state, and it is significantly lower than Nevada’s overall unemployment rate of 3.6 percent.
Total wages earned by Elko County workers increased significantly over the past year, despite employment remaining somewhat flat. In the fourth quarter of 2018, private industry workers in Elko County collectively earned $250.8 million in wages and salaries, 6.4 percent more than during the fourth quarter of 2017. Total annual private wages earned in Elko County were up 6.8 percent in 2018.
Consumer spending has grown in concert with this rise in income. Taxable retail sales in Elko County for March 2019 grew by 11.0 percent year over year, and the trailing 12-month total increased 7.1 percent from the prior year. By comparison, statewide taxable retail sales increased 6.0 percent over the past 12 months. Gross gaming revenue in Elko County has also outpaced the statewide growth rate, increasing 5.0 percent to $302.4 million over the 12 months through April 2019. Statewide gaming revenue over the same period increased by just 1.2 percent. As wages rise and disposable income increases, these measures should continue to show positive growth.
Elko County’s gaming market has been noticed, as Maverick Gaming recently completed the acquisition of three Elko casinos from Navegante Gaming & Hospitality. The casinos involved in the sale are the Red Lion Casino, Gold Country Casino and the High Desert Inn.
Mining and Agriculture Update
Employment growth in the mining industry has continued to outpace overall employment growth in Elko County. On a trailing four-quarter average basis, mining employment in Elko County grew by 3.1 percent from the fourth quarter of 2017 to the fourth quarter of 2018, compared to overall employment growth of 0.6 percent. Over the same period, total mining wages in Elko County rose by 5.0 percent, outpacing the statewide mining wage growth rate of 3.7 percent. Two of Elko County’s other noteworthy industries, cattle ranching and farming, have experienced relatively flat employment and wage growth during the same timeframe. On a trailing four-quarter basis, employment in those industries was down 0.9 percent while total wages were up 1.3 percent.
The Nevada Gold Mines joint venture between Barrick Gold Corp. and Newmont Goldcorp Corp. announced earlier in the year has already had an impact on the local community, with a round of layoffs that meant 58 people were laid off, most of whom were based in Elko County. Another 120 people were laid off earlier in the year at Newmont’s Carlin, Nevada operations due to a slide at a pit and cost impacts at another open pit mine. In other local mining industry news, Newcrest Mining completed the comment period for its proposed one-year exploration drilling program in Jarbidge in northern Elko County. The program would lead to the construction of 15 drilling sites. Another mining company, Canada-based Contact Gold Corp., is beginning an exploration and drilling program at the Pony Creek gold property in the Pinion Range in western Elko County.
Q1 2019
Economic Update
Elko County’s economy remains strong, benefitting from broader trends that have led to increased economic growth throughout the country and across the state of Nevada. Employment in Elko County continues to fluctuate from month to month, but the long-term trend remains positive. Through December 2018, overall employment increased by 1.0 percent year over year in Elko. The labor force in Elko County increased by an equal 1.0 percent over the same timeframe, keeping the unemployment rate consistent at 3.3 percent from the prior year. Elko County’s 3.3 percent unemployment rate remains one of the lowest in Nevada, and it is significantly lower than Nevada’s overall unemployment rate (4.4 percent) as well as those of similarly sized counties such as Carson City (4.5 percent), Douglas County (4.4 percent), Lyon County (5.4 percent) and Nye County (5.7 percent).
While employment in Elko County has remained relatively consistent, the total wages earned by Elko workers have increased significantly over the past year. In the third quarter of 2018, private industry workers in Elko County collectively earned $235.7 million in wages and salaries, 9.5 percent more than during the third quarter of 2017. Over the past four quarters, total private wages earned are up 6.3 percent in Elko County.
This increase in income throughout the county has contributed to large increases in consumer spending. Taxable retail sales in Elko County for December 2018 grew by 6.2 percent year over year, and the trailing 12-month total increased 6.3 percent from the prior year. By comparison, statewide taxable retail sales have increased by 5.4 percent over the past 12 months. Gross gaming revenue in Elko County has shown similar growth, also outpacing statewide growth by a significant margin. Over the 12 months through January 2019, Elko gaming revenue totaled $300.0 million, an increase of 4.9 percent from the prior 12-month period. Throughout Nevada, the trailing 12-month total of gaming revenue has increased by just 2.9 percent. As wages rise and disposable income increases, measures like these should continue to show positive growth.
Mining and Agriculture Update
Mining industry employment and wages in Elko County have grown faster than in other sectors of the economy over the past year. As of the third quarter of 2018, mining employment in Elko County had increased 3.3 percent from the prior year, and the trailing four-quarter average mining employment was 7.7 percent higher than the prior four-quarter period. Total wages earned within the mining sector over the past four quarters rose 8.9 percent within Elko County, more than double the statewide increase of 4.0 percent over the same period.
The first quarter of the year has been marked by major corporate moves among the state’s mining companies.
After Barrick Gold Corporation officially merged with Rangold Resources Limited in January 2019 to create the world’s largest gold mining company, Newmont Mining Corporation agreed to acquire Goldcorp to create a new global gold mining leader. More recently, Barrick and Newmont agreed to merge their operations in Nevada to cut costs and improve efficiency. The agreement followed news that Barrick might acquire Newmont in another merger, even attempting a hostile takeover with an $18 billion buyout offer. Newmont’s board of directors rejected the attempted takeover before the two companies agreed to the joint venture.
Barrick will be the majority owner of the joint venture, with a 61.5 percent stake to Newmont’s 38.5 percent. The new joint venture will hold a dominant position in the Nevada mining industry; in 2017, Barrick and Newmont were responsible for 75.8 percent of all gold production and 19.5 percent of silver production in Nevada.
Q4 2018
Economic Update
Elko County continues to see steady economic growth in a number of different indicators. Countywide employment has been trending upward over time, finishing 2.8 percent higher year over year in October 2018 following 2.1 percent year-over-year growth in September 2018. This employment growth has helped keep Elko County’s unemployment rate among the lowest in the state at 3.0 percent in October 2018, which ranked second among Nevada counties behind only Eureka County’s 2.5 percent rate.
Elko County’s unemployment rate was far below the statewide rate of 4.2 percent and compares even more favorably to the 4.4 percent rate recorded in Clark County. While Elko County has reported significant decreases in unemployment, the decrease has been a part of a broader statewide trend. Initial unemployment insurance claims in Nevada during September 2018 declined 8.6 percent year over year to 8,289, the lowest monthly number since 1998. The 20-year low comes despite an overall employment increase of 50 percent and population increase of 72 percent over that timeframe.
Taxable retail sales growth in Elko County has also outperformed the rest of the state over the past year. Through September 2018, the trailing 12-month total of taxable retail sales in Nevada grew by 4.5 percent, while Elko County experienced 5.2 percent growth in retail sales. Gaming revenue grew considerably in Elko County as well, another indicator of growing consumer confidence and disposable income. In the 12 months through October 2018, gross gaming revenue in the county grew by 7.4 percent to $296.2 million, just $7 million below the record for any 12-month period of $303.5 million set in 2007.
Mining and Agriculture Update
Newly released data from the Nevada Division of Minerals shows that Elko County led the way in statewide gold production growth in 2017, with output increasing by 50.4 percent year over year compared to a 3.2 percent increase for the state as a whole. In fact, outside of Elko County gold production declined around the rest of the state, as the 13 metric ton production increase in Elko County was greater in absolute terms than the roughly 5.4 metric ton increase statewide. Excluding Elko County, the state reported a production decrease of 7.7 metric tons of gold in 2017. A proposed expansion of Newmont Mining’s Long Canyon Mine, which would double the size of the current open-pit mine and add an underground mining operation, will potentially extend the mine’s productive life by roughly 25 years and could further increase Elko County’s mineral production capacity in the years to come.
Throughout Nevada, new exploration and mineral discoveries have led to new mining operations and the expansion of existing mines. In October 2018, Itronics announced the discovery of gold and copper at an exploration site in the Yerington Mining District in Lyon County. According to the company, its measurements suggest the possibility of significant amounts of gold, silver, copper and zinc at the site. Coeur Rochester, Nevada’s largest silver producer, is also planning an expansion of its mine near Lovelock in Pershing County, which is already one of the largest silver mines in the country. The company expects this expansion to extend the productive life of the mine into the 2030s as well as increase the mine’s efficiency in recovering silver and gold from mined ore. The multi-faceted expansion is expected to cost roughly $52 million.
Q3 2018
Economic Update
Taxable retail sales in Elko County continued a positive 2018 trend in June 2018 as the trailing 12-month total climbed 3.1 percent higher than the prior year. June marked the sixth straight month of year-over-year increases in the trailing 12-month total after 13 consecutive months of decline in the measure, including all of 2017. Growth in the Elko County mining sector has been particularly strong, as sales related to mining and mining support have increased by 14.4 percent over the same timeframe. Elko County’s mining sales growth stands in contrast to Nevada’s performance in the sector, as the statewide trailing 12-month total declined 7.6 percent from last year.
Elko County has also outperformed Nevada over the past year in casino gaming revenue growth. Over the 12 months through July 2018, Elko County gaming revenue increased by 6.5 percent from the prior year, while statewide gaming revenue grew by 3.4 percent. The growth rate of 6.5 percent is slightly lower than earlier in the year but, 2018 excluded, remains higher than at any point since early 2008.
Employment growth in Elko County has trailed statewide trends, growing 0.4 percent year-over-year through July 2018. However, the county’s unemployment rate remains one of the lowest in Nevada at 3.2 percent compared to the statewide unemployment rate of 4.5 percent. Despite the relative lack of job growth, Elko County workers continue to earn more on average than workers throughout the state. Average weekly wages in the county reached $1,001 in the first quarter of the year, 2.5 percent higher than the $977 statewide average.
Mining and Agriculture Update
While overall employment in Elko County has remained steady, the mining sector continues to report notable growth. In the first quarter of 2018, mining employment in the county totaled 1,290, a 10.3 percent year-over-year increase. Total wages paid in the mining sector have grown as well, rising 13.1 percent year over year in the first quarter. These measures of mining activity in Elko County have significantly outperformed Nevada’s mining sector as a whole. Statewide mining employment has remained flat over the past year, and overall mining wages in the state grew 6.0 percent year over year, less than half of the growth rate in Elko County.
The price of gold has steadily declined in 2018, settling at $1,202 per ounce at the end of August 2018, 8.3 percent lower than August 2017. Despite the downward trend, the trailing 12-month average price remained 2.8 percent higher than the prior year.
The agricultural sector has also reported growth over the past year. Ranching and farming employment in Elko County rose 3.1 percent year over year in the first quarter of 2018, while total wages earned climbed 7.7 percent in the same period. On a trailing 12-month basis, average employment in the sector rose 2.0 percent and total wages earned have risen by 3.3 percent over the past year. Hay prices have remained elevated so far in 2018, as the price per ton has averaged $176.50 over the 12 months through June 2018. This represents a 14.3 percent increase over the previous 12-month period, when hay prices averaged $154.42.
Q2 2018
Economic Update
After the unemployment rate in Elko County briefly jumped to 4.2 percent in January 2018, it has declined for three straight months to 3.4 percent in April. That ranks as the second-lowest unemployment level among all Nevada counties. The lower unemployment rate is not the result of increasing employment but rather a smaller labor force, which reported year-over-year declines in three straight months and in five of the past seven months. In April 2018, the labor force decreased by 2.3 percent from the year prior, while total employment declined by 2.0 percent to 25,788.
Total private sector wages earned in 2017 grew by 5.2 percent from 2016, fueled by the two best quarters for total wages in Elko County since 2012. Consumer spending indicators also reported positive trends. The trailing 12-month total of taxable retail sales grew year-over-year for three straight months through March 2018 following a 13-month streak of decline. Elko County gross gaming revenue in the 12 months through April 2018 climbed 6.9 percent year over year to $288.0 million, marking 14 consecutive months of year-over-year increases.
Housing prices in Nevada continue to rise at a rapid pace, increasing 13.7 percent year-over-year through the first quarter of 2018, which was the fastest housing appreciation in the country according to the Federal Housing Finance Agency House Price Index. While the rapid increase in prices has been challenging for homebuyers, it has been a boon to both homeowners and home builders, who have steadily increased construction activity to meet growing demand.
Mining and Agriculture Update
Elko County employment in the mining and agriculture sectors reported positive trends to close 2017. In the fourth quarter of 2017, mining employment in Elko County grew 10.3 percent year over year, and average employment in the sector for 2017 was 13.2 percent higher than 2016. Wages paid in the mining industry also grew significantly in 2017 as employees in Elko County earned 11.9 percent more than in 2016, nearly four times the statewide growth of 3.0 percent for the year.
Total gold production in Nevada grew to 5.64 million ounces in 2017, a 3.2 percent increase from 2016. Nevada accounted for 72 percent of total U.S. gold production and would rank fifth among the largest gold-producing countries, behind China, Australia, Russia and Canada. The average price of gold rose slightly during 2017, averaging $1,257 per ounce on the year. For the first five months of 2018, gold has averaged a price of $1,325. As mineral prices have risen and both the Nevada and national economies have improved, mining companies have begun to expand operations throughout the state. This includes Elko County, where Premier Gold Mines plans to construct or expand its South Arturo and El Nino mines near Carlin.
Cattle ranching and farming in Elko County also performed positively in 2017. Employment in the fourth quarter of 2017 was up 4.4 percent year over year in Elko County. Wages paid in the sector grew similarly, increasing 3.9 percent in Elko County during the year.
Q1 2018
Economic Update
Total employment in Elko County rebounded in December 2017, ending five consecutive months of decline. Despite that trend, year-over-year employment increased for seven straight months to close the year at 26,031, a 3.1 percent increase over the prior year. The county’s annual job growth was in line with statewide employment trends, as Nevada’s employment total grew 3.3 percent over the year. The mining and natural resources and construction industries have been leading Elko County job growth, with year-over-year increases of 5.0 percent and 11.7 percent, respectively, through the second quarter of 2017 (latest data available). Overall job growth helped lower the county’s unemployment rate to 3.3 percent in December, the lowest level since November 2007. Nevada’s unemployment rate stood at 4.7 percent, and within the state only Eureka County’s 2.6 percent unemployment rate beat Elko County’s mark.
Gross gaming revenue in Elko County totaled $282.6 million in 2017, a 5.2 percent annual increase that was the highest year-end growth rate since 2007. By comparison, statewide gaming revenue grew by 2.8 percent in 2017. Trailing 12-month totals for taxable retail sales in Elko County declined on a year-over-year basis for 13 consecutive months through December 2017. However, that month reported a single-month total of $134.3 million, the highest level in two years, resulting in a slight decline in annual taxable sales of 0.2 percent.
In the fourth quarter of 2017, Nevada continued to rank among the top performing states for home price appreciation. The federal purchase-only House Price Index for the state increased 11.5 percent compared to the prior year, ranking third in the nation. The states that outperformed Nevada were also all in the West: Washington and Idaho.
Mining and Agriculture Update
Gold prices remained steady through the end of the year, and December 2017 marked the 17th straight month of year-over-year increase in the trailing 12-month average price of gold. Taxable retail sales attributed to the mining industry in Nevada also improved late in 2017, with October ending a seven-month streak of year-over-year declines in the trailing 12-month total. The year closed with $256.3 million in total mining-related taxable retail sales, a 0.7 percent increase over 2016. Through the second quarter of 2017, Elko County mining employment increased 14.5 percent year over year, and total wages paid to mining workers in the county rose 16.0 percent. The mining industry was one of the fastest growing sectors of the U.S. economy during 2017, and the same was true within Nevada. Statewide mining gross domestic product was up 16.1 percent year-over-year as of the third quarter of 2017.
Nevada’s cattle inventory grew from 445,000 head at the start of 2017 to 465,000 head at the start of 2018, an increase of 4.5 percent. Beef prices also increased throughout 2017 after declining in 2016. The January 2018 average price of beef per pound rose by 4.5 percent year over year to $7.42 per pound. Employment in cattle ranching and farming within Elko County has also posted year-over-year gains in four straight quarters through the second quarter of 2017, rising to 216 in that timeframe. Total wages paid in the ranching and farming industry in Elko County grew significantly during those four quarters as well, rising by 9.8 percent over the prior four quarters to reach over $6.1 million. Hay prices in December 2017 were $170 per ton, 18.1 percent higher than the same period in 2016 despite falling slightly from their peak in June and July.
Q4 2017
Economic Update
In October 2017, overall employment in Elko County declined slightly for the fourth straight month, yet remained 2.2 percent higher than the prior year with nearly 26,000 workers. The size of the labor force also declined slightly for the third consecutive month. These changes pushed Elko County’s unemployment rate to 3.4 percent, among the lowest in the state and well below the statewide rate of 4.8 percent. Elko County’s unemployment rate declined by 0.6 percentage points year-over-year, a faster improvement than the statewide decline of 0.4 percentage points since October 2016.
Wage growth in Elko County has been another economic highlight. Weekly wages averaged $907 in the second quarter of 2017, a 3.2 percent increase over the prior year. On a trailing 12-month basis, average weekly wages reached an all-time high of $946, 4.1 percent better than the prior year. Total wages during the same time period climbed 4.7 percent to $216.2 million over the year, and on a trailing 12-month average basis, the improvement is even greater, with 5.8 percent growth over the prior year.
Other indicators reported mixed results. Gross gaming revenue in Elko County recorded positive year-over-year growth in six of the past seven months through September 2017, with performances no lower than 4.5 percent in those positive months. On a trailing 12-month basis, gaming revenues grew year-over-year by 2.7 percent in both August and September, the best performance since December 2015. Meanwhile, taxable retail sales in the 12 months through August 2017 reported a 2.2 percent year-over-year drop, the ninth straight month of declining performance.
Mining and Agriculture Update
The mining and agriculture sectors of Nevada and Elko County’s economies have performed better over the past year than the rest of the economy. While Nevada’s average weekly wage rose 2.7 percent year-over-year in the second quarter, the average weekly wage for mining operations increased by 8.7 percent. Total mining wages in the state increased by 10.2 percent in the same timeframe. Elko County ranching and farming wages reported a similar 10 percent increase from the prior year.
This trend mirrors the national trend for the mining and logging sector, which has shown the largest employment increase nationally by a wide margin over the past year. In October 2017, jobs in mining and logging grew by 8.2 percent over the past 12 months in the United States. The next best performers, construction and professional or business services, were tied with 2.6 percent growth.
In November 2017, the Governor’s Office of Economic Development (GOED) brought representatives of 10 Canadian mining companies to Elko County to learn what the region has to offer as an investment opportunity within the mining industry. Mining jobs are some of the most lucrative in the state, with average weekly wages for the industry more than twice the state average, and GOED has continued to make the industry a priority in the new Nevada economy. Attracting new companies to the state and expanding operations for mining in-demand minerals such as lithium will provide additional growth opportunities for one of Nevada’s original industries.
Q3 2017
Economic Update
Elko County’s unemployment rate rose for the second consecutive month to reach 3.9 percent in July 2017. This coincides with three consecutive months of labor force growth through July, which reversed the downward trend of much of the past year. Despite the rising unemployment rate, Elko County is tied for the second-lowest rate in the state behind Eureka County’s 3.3 percent and is well below the state average of 5.1 percent. While rising unemployment rates are generally a negative sign for the economy, the recent elevation was attributable to an expanding labor force rather than job losses.
While employment has recorded modest growth, wages in Elko County have grown significantly, as total wages for the first quarter of 2017 increased 3.7 percent over the prior quarter and 13.8 percent over the prior year. Gross gaming revenues in the county also experienced significant growth. The $25.2 million in gross gaming revenue for July 2017 was 11 percent more than the county reported in June and 8.1 percent higher than the total from the previous July. Taxable retail sales also saw growth, albeit slightly more modest. The latest data available show that taxable retail sales totaled roughly $132.7 million in June 2017, 1.0 percent greater than the prior year. While many indicators have shown positive trends recently, the private business count in Elko County has been declining. The total fell to 1,296 during the first quarter of 2017, a decline of 3.5 percent from the prior quarter and 4.8 percent from the previous year.
Mining and Agriculture Update
The monthly average price of gold rose above $1,300 per ounce for the first time in 2017, climbing to $1,312 per ounce in August 2017. That month also marked the 13th straight month of year-over-year growth of the 12-month rolling average price, indicating stable long-term growth despite month-to-month fluctuations. Employment in the mining sector also rose to a two-year high during the quarter, reaching 11,400 in July, 0.9 percent higher than July 2016. While the year-over-year growth was modest, the mining sector in Nevada has grown by 4.6 percent since the start of 2017. In Elko County, the growth has been more significant. Data from the first quarter of 2017 reported 1,170 mining jobs in Elko County, 17.1 percent greater than the previous year.
Hay prices continued to rally, rising from $169 per ton in May to $179 in June, an increase of 5.9 percent. Average prices have gone six months without declining, and June’s price of $179 per ton was 11.9 percent greater than the prior June’s price. Positive signs for the agricultural sectors can also be seen in wage data. While the $1.3 million in total wages for the sector in Elko County during the first quarter of 2017 were 23 percent below the prior quarter, the first quarter of each year is generally slow for the industry. Year-over-year total wages in the sector showed strong growth of 11 percent.
Q2 2017
Economic Update
While Elko County’s long-term trend of declining employment has continued, the decline has slowed recently. As of April 2017, the trailing 12-month average was only 13 jobs below where it was for the same period last year. Despite the stagnating levels of overall employment, Elko County’s unemployment rate has steadily declined, registering 3.5 percent in April. This ranked as the second-best mark in the state behind only Eureka County’s 3.0 percent and fell well below the state average of 4.7 percent. These contradictory numbers are partially explained by Elko County’s slowly shrinking labor force, which is likely a result of an aging population and migration to other areas of the state.
Statewide initial unemployment insurance claims have continued to decline, with the trailing 12-month total for April 2017 falling 7.6 percent below last April’s level. Average weekly hours worked by Nevada employees have remained relatively constant for several years, fluctuating in the 33- to 34-hour range. Over the past 12 months, however, that number has grown faster than at any point during the past decade on a trailing 12-month basis, rising 1.5 percent to 34.1 hours in April 2017. Housing in Nevada has continued to show strong price appreciation. The House Price Index for the first quarter of 2017 was 8.9 percent higher than the same period the previous year, ranking Nevada seventh in the nation.
Elko County has reported recent declines in taxable retail sales, which in February 2017 showed a trailing 12-month decline of $41.3 million from the prior year, a 2.8 percent drop. February marked the third straight month of trailing 12-month declines after 18 straight months of growth in taxable retail sales. Gaming revenue in the county has shown positive growth, however, riding a particularly strong month of March when gaming revenues rose 12.8 percent over the prior year. Overall, Elko County’s trailing 12-month total gaming revenue climbed 1.3 percent higher than the previous year.
Mining and Agriculture Update
The mining and agriculture industries have experienced recent positive signs in Elko County and throughout the state. Mining employment in Nevada has increased nearly 2 percent since the beginning of 2017, numbering 11,000 in April 2017, up from 10,800 in December 2016. Rising mining employment coincides with the rising price of gold, which has trended higher since the start of the year after declining over the second half of 2016. Gold averaged $1,266 per ounce in April 2017. While this represents a 1.6 percent decrease from the prior year, the more recent trend is entirely positive as gold has increased in price by 10.5 percent since the $1,146 per-ounce average in December. The trailing 12-month average price of gold has grown year-over-year for nine straight months, the first period of price growth in more than three years.
Mining wages in the state recorded year-over-year growth in both average weekly wages and total wages in the fourth quarter of 2016. Average weekly wages grew 3.9 percent over the prior year to $1,830, while total wages grew 5.6 percent to $261.3 million. Although there was significant growth compared to the prior year, slight declines were reported between the third and fourth quarters as average weekly wages fell by 1.1 percent and total wages declined 2.1 percent. Overall, that decline appears to mirror a multi-year pattern with wages trending upward in the long term.
Hay prices have also performed well over the past year, with the April 2017 average of $167 per ton climbing 32.5 percent higher than April 2016 prices. More than half of that growth has come since the beginning of 2017. Beef prices are also beginning to show signs of rebounding. After declining by 10.7 percent between July 2015 and January 2017, prices have remained fairly stable so far this year, rising 1.1 percent between January and April, the latest month of available data. This stabilization is important for the value of the state’s cattle herds, which lost over 19 percent of total value during 2016 despite growing 2.3 percent with the addition of 10,000 head.
Q1 2017
Economic Update
2016 was a strong year of growth for Nevada’s economy. Nevada’s Department of Employment, Training and Rehabilitation (DETR) recently reported that the state added 41,000 jobs during 2016, which dropped the seasonally-adjusted unemployment rate to 5.1 percent in December, down from 6.3 percent in December 2015. Initial unemployment insurance claims were 11.7 percent lower in 2016 as well, indicating a lower level of turnover for the year. Elko County employment has not followed the same trend, shrinking slightly by 0.2 percent between December 2015 and 2016. However, the county’s unemployment rate saw a decrease identical to Nevada, dropping from 5.1 percent to 3.9 percent, giving it the third-lowest unemployment rate among Nevada’s counties behind Esmeralda and Eureka.
Total wages in Elko County showed strong growth late in 2016, with third quarter earnings in the county totaling nearly $219 million. This represented a 5.9 percent increase from the second quarter of 2016 when wage earnings totaled just $207 million and was 4.6 percent higher than the third quarter of 2015 when $209 million of wages were earned. These gains came even as the total employment level dipped slightly over the course of the year. Wages in mining and agriculture grew significantly in the third quarter and were likely a significant contributor to these overall gains. According to DETR, statewide average private weekly wage earnings rose 10.7 percent year-over-year in the third quarter.
Taxable retail sales rose slightly in Elko County over the past 12 months through November when compared to the prior year, growing by 1.8 percent to nearly $1.5 billion. Gross gaming revenue also increased slightly, rising by 1.1 percent in 2016. Statewide, home values have seen significant increases. In the third quarter of 2016, average home values were 7.8 percent higher than the same quarter in the prior year. While prices remain below peak levels from the boom years of the early 2000s, they have shown strong and steady growth in recent years.
Mining and Agriculture Update
January 2017 gold prices were up 5.8 percent from December 2016 and up 9.1 percent from the prior January. Overall, 2016 saw higher average gold prices than 2015, which is a positive sign for the mining industry in Nevada. Statewide there was no growth in mining employment throughout the year, measuring 10,800 jobs at the end of 2015 and 2016. Wages in the industry, however, have shown positive signs. The most recent wage data available is for the third quarter of 2016, when average weekly mining wages showed a 2.6 percent gain from the prior year, and total mining wages paid grew 1.1 percent in the same period. Mining’s contribution to statewide taxable retail sales declined over the past year, with the trailing 12-month total for November 2016 falling 0.5 percent from the prior 12-month period.
Agriculture in Nevada has experienced price declines throughout 2016. Hay prices averaged $189.50 per ton in 2015, but just $147.64 through the first 11 months of 2016, a difference of just over 22 percent. For Nevada’s cattle ranchers, 2017 marks the second straight year that the total cattle herd has grown, now numbering roughly 445,000 head. However, 2017 is also the second straight year that the total value of those cattle has declined due to the falling price of beef. In 2015 Nevada’s cattle were worth an estimated $748 million. In January 2017, the state’s herd had an estimated value of $512 million, a loss of over 32 percent, despite growth of 15,000 head in the same period. Leading up to 2015, prices rose at an extraordinarily fast rate, a trend that the market is now correcting. Regardless of this loss of value over the past two years, Nevada’s cattle herd value is up 23.6 percent since 2010 despite a slightly smaller herd by head count in 2017.
Even as prices have declined in certain agricultural areas, employment and earnings in the industry showed strong growth. In the third quarter of 2016, employment in the sector for Elko County was 8 percent above the third quarter of 2015, and total wages paid climbed nearly 14 percent to over $1.5 million in the same timeframe.
Q4 2016
Economic Update
While Nevada as a whole has seen employment growth of roughly 2 percent over the past year, Elko County has seen stagnation, growing only 0.3 percent over the same period. However, this seems to be the result of a shrinking workforce rather than lack of opportunity: Elko outperforms most of the state by far in unemployment rate, registering just 4.1 percent in September compared with the statewide figure of 5.8 percent.
Elko County mirrors the strong statewide trends in many other indicators, with strong year-over-year growth in total earned wages, taxable retail sales and gaming revenues. Total wages in Elko County increased 3 percent from 2015 to $206.6 million in the second quarter of 2016. Taxable retail sales were up 5 percent in August 2016 compared to August 2015, with a total of $129.7 million. Finally, gross gaming revenues were up 4.9 percent year-over-year in September, rising to $23.5 million. Elko County’s year-over-year wage growth comes despite a statewide decline in average weekly wages in the mining industry, an important segment of the Elko area economy.
Elko County also recorded 1.9 percent year-over-year growth in private business establishments, up to 1,346 in the second quarter of 2016. This increase, along with the statewide 2.4 percent increase in average weekly hours worked over the past year, show the increasing availability of opportunities for the workforce in both Elko County and Nevada as a whole.
Mining and agriculture Update
Gold prices have started to decline slightly after posting strong growth throughout the first half of 2016. At the end of October, gold was priced at $1,272 per ounce, a 5.2 percent drop from the July 2016 high of $1,342. However, the price remained 11.4 percent higher than the October 2015 price of $1,142 per ounce and 20 percent above the six-year low of $1,060 in December 2015.
Mining employment in Nevada has stagnated over the past year, registering 10,900 jobs statewide in October 2016. This represents no change over the past year, as 10,900 mining jobs were also reported in October 2015, and a slight drop of 1.8 percent from the 11,100 mining jobs recorded in June and July of 2016.
Wages in the cattle ranching and farming sector of Elko County’s economy continue to grow, reaching nearly $1.4 million in the second quarter of 2016, up 5.1 percent from the second quarter of 2015. Elko County employment in the sector for the second quarter was 211, identical to the same period in 2015. Therefore, per capita income for workers in the ranching and farming sector grew by the same 5.1 percent over the past year. Hay prices were down year-over-year, falling 8.9 percent to $144 per ton in September 2016. However, that price is significantly above the low point in April 2016 when hay sold for $126 per ton. Beef prices have continued to decline steadily throughout 2016, with retail value falling to $5.96 per pound in the third quarter of 2016, 5.6 percent below the $6.31 per pound during the third quarter of 2015.
Q3 2016
Economic Update
Nevada continues to steadily gain economic ground as employment figures showed another quarter of improvement. Nevada reported nearly 1.29 million jobs in July 2016 (latest available data), a 2.7 percent increase over the same period in the previous year. Unemployment also saw positive trends as Nevada reported an unemployment rate of 6.5 percent in July 2016 (latest available data). This represents a drop of half a percentage point from July 2015.
Elko County continues to see a gradual decline in employment despite the positive state-level trends. In July 2016, Elko reported 26,070 jobs, which represents a decline of 0.6 percent from the same month in the prior year. Even with the slight dip in total jobs, the unemployment rate in Elko County improved to 5.0 percent in July 2016, a 0.3 percentage point drop from a year earlier. The county’s rate also remained well below the statewide average.
Taxable retail sales in Nevada maintained their positive trend in June 2016, improving 4.8 percent on an annual basis to $52.8 billion. Elko County taxable retail sales increased as well, climbing 3.2 percent on a rolling 12-month basis to $1.5 billion. June 2016 marked the seventh consecutive month of annual growth of 3.0 percent or more, a welcome trend after Elko County retail sales growth stagnated through most of 2015.
Mining Update
The price of gold has been on the rise in 2016, nearing prices that haven’t been seen in three years. Since reaching a recent low of $1,060 per ounce in December 2015, the price of gold has steadily climbed to $1,342 as of July 2016. That price represents a 22.2 percent improvement over the prior year and a 26.6 percent from the December 2015 low.
Though the price of gold has climbed in the past year, metal ore mining employment in Nevada has declined. Nevada reported 11,100 industry jobs in July 2016, a 3.5 percent decline from the 11,500 industry jobs a year earlier. Yet mining workers saw average weekly pay climb to $2,179 in the first quarter of 2016, a 2.0 percent increase over the prior year and a 23.7 percent rise over the previous quarter. Mining-related taxable retail sales have also reported positive growth, rising 5.9 percent to $258.2 million over the prior 12 months through June 2016.
On the state agriculture front, total wages in the cattle ranching and farming sector increased to $1.2 million in the first quarter of 2016, an improvement of 4.7 percent over the prior year. Meanwhile, hay prices in the state have decreased over the past 12 months. Hay sold for an average of $159 per ton in May 2016, a price that was 20.5 percent below the $200 of a year earlier.
Q2 2016
Economic Update
Nevada’s economy carried over many of the positive trends of 2015 into the early part of 2016. Statewide annual job growth reported a 2.9 percent improvement in April 2016 (latest data available) on a rolling 12-month basis. The addition of 30,200 jobs over the previous year brought total employment in Nevada to 1.28 million. If that growth rate continues, the state will return to pre-recession employment levels before the end of the year. Nevada still has one of the nation’s highest job growth rates, though its ranking has declined from second to eighth since March 2015. Meanwhile, the state’s unemployment rate continued its improvement over the past year, declining from 6.9 percent to 5.8 percent.
In Elko County, the number of jobs has been shrinking on an annual basis since September 2013. Since that point, trailing 12-month average employment has fallen from 27,260 to 25,960, an overall decline of 4.8 percent. Over the past year, the number of jobs in the county dropped 2.2 percent. Despite that trend, a shrinking labor force helped the countywide unemployment rate improve from 5.3 percent to 5.0 percent during that timeframe.
Taxable retail sales in Nevada maintained their positive trend in March 2016, improving 4.6 percent on an annual basis to an all-time high of $52.0 billion. Elko County taxable retail sales increased as well, climbing 3.9 percent on a rolling 12-month basis to $1.5 billion. March 2016 marked the fourth consecutive month of annual growth at or near 4.0 percent, a welcome trend after Elko County retail sales growth had stagnated through most of 2015.
Mining and Agriculture Update
After an extended period of overall decline, the price of gold had its best four-month stretch since mid-2012. Between December 2015 and April 2016, the price of gold has climbed 21.3 percent from $1,060 to $1,286. That surge pushed the price to its highest point since August 2014, and the latest price represents a 9.0 percent increase over April 2015.
Even as the price of gold has improved, metal ore mining employment in Nevada has declined. The 10,800 jobs reported in April 2016 represent a 3.6 percent decline from the 11,200 industry jobs a year earlier. Metal ore mining employment peaked at 12,300 in July 2013 after a period of significant growth in gold prices. The trend in pay for metal ore mining workers has remained positive, however, as average weekly wages for the industry rose to $1,762 in the fourth quarter of 2015, a 5.6 percent increase over the prior year. Mining-related taxable retail sales have also reported positive growth, rising 4.7 percent to $256.2 million over the prior 12 months through March 2016.
On the state agriculture front, Nevada recorded 435,000 in cattle inventory (including calves) as of January 2016. That total signified a modest 1.2 percent increase from the 430,000 reported a year earlier. Value per head of cattle declined significantly over the period, falling 16.1 percent from $1,740 to $1,460. Hay prices in the state have decreased in the past 12 months, as well. Hay sold for an average of $126 per ton in April 2016, a price that was 40.8 percent below the $213 of a year earlier.
Q1 2016
Economic Update
Nevada finished 2015 with a bevy of positive economic news, including a number of indicators that closed the year among the best in the nation.
The state’s expanding jobs market led economic news headlines throughout the year. Annual average employment grew by 37,500 jobs in 2015 for an annual growth rate of 3.1 percent. That rate ranked sixth-best in the United States. If statewide employment continues to expand at about the same rate in 2016, the total number of jobs will return to pre-recession levels later this year. Growing employment pushed the state’s seasonally adjusted unemployment rate down to 6.4 percent, the lowest since 2008. Despite the improvement, Nevada’s unemployment rate remained among the three highest in the country.
In contrast to state trends, Elko County’s annual average employment shrank to 26,125 (-1.9 percent) in 2015, and its unemployment rate climbed to 5.0 percent in December 2015, up slightly from 4.8 percent a year earlier.
Nevada’s strengthening labor market sparked a surge in wage growth as employers have raised pay to attract and retain workers. Although average weekly hours remained flat at 33.6 (+0.5 percent) over the year, average weekly wages climbed 5.2 percent to $736.92. Nevada’s wage growth rate in 2015 led the nation and more than doubled the average U.S. rate of 2.4 percent.
Improving job prospects, rising pay and growing home values in Nevada contributed to rising consumer confidence. Statewide taxable retail sales, the primary measure of consumer spending, grew by 5.5 percent to a record $51.7 billion in 2015. Annual retail sales in Elko County grew 4.1 percent to $1.5 billion last year, which remained below peak levels reported in mid-2013.
Mining Update
Barrick Gold recently announced a major expansion of operations that includes a $1.5 billion investment in three Nevada mines. The largest investment of $1 billion will be made to develop an underground mine at Goldrush, a new deposit near Elko. When it comes online in 2021, the mine is expected to produce 440,000 ounces of gold a year.
At the Turquoise Ridge mine near Winnemucca, Barrick will invest up to $325 million to add a third shaft that will boost annual gold production from 280,000 ounces to 500,000 ounces. Barrick owns a 75 percent interest in the Turquoise Ridge mine. Additionally, the company announced a $153 million investment to extend the Cortez Hills mine deeper underground. When finished, the expansion would increase production by 300,000 ounces per year.
Barrick’s announcement comes as the gold mining industry continues through a steady decline phase. The U.S. monthly price of gold in December 2015 dropped to $1,060 per ounce, its lowest point since October 2009. The latest gold price represents a 12.1 percent decline from a year earlier and a 41.6 percent tumble from the August 2011 peak of $1,814 per ounce.
Metal ore mining employment in Nevada generally tracks gold prices. In line with the falling gold price, monthly employment in December 2015 dipped to 10,300, an 8.8-percent drop from the prior year and the lowest mark since March 2011. At the July 2013 peak, metal ore mining employed 12,300 workers in Nevada.
While the number of metal ore mining employees has declined, the amount of money they are earning has climbed. In the third quarter of 2015 (latest data available), average weekly wages increased to $1,804, a 6.8-percent improvement from the prior year, and total quarterly wages reached $264.1 million, a 5.6-percent increase over the same period.