Within the space of a couple weeks, Forbes magazine published the results of a nationwide poll showing Las Vegas tying with New York City as the coolest city in the U.S. Hot on the heels of that was Forbes noting that Las Vegas is the “most stressed” city in the county. How could this be? Simple:
The local problems with unemployment and the housing market have nothing to do with your visitor experience. Tens of thousands of people bought homes in new neighborhoods here a few short years ago, paying well over what the traditional value of local homes has been. Many/most of them were also new to town and assumed that the boom-time wages helping them pay that inflated home price were the norm. Now they are underwater on the house, possibly out-of-work (or one spouse is unemployed), or they are underemployed and guess what: That is stressful. But that has nothing to do with your visitor experience.
A recent Review-Journal/KLAS TV poll noted that 71% of locals feel that the economy will stay the same or get worse over the next year. I agree. Here’s why: 34% of locals would leave if the could but can’t (no pending job elsewhere, too far underwater on home). This is simply going to prolong the pain. Here’s why:
The construction jobs that fueled this economy are simply not coming back. Not for many, many years. Construction workers needed everything from a haircut to car insurance to food… and that money trickled through the entire local economy. Which means that those jobs ALSO are GONE. So… you have 34% of the population holding on for dear life. Many of whom will be stressed to the point that they’ll still eventually throw in the towel. Their unemployment will run out, they will realize that the house payments are simply unmanageable, and they’ll pack up and drive away.
So then what? In 3-5 years, we’ll see the revitalization of the local population. Cheap housing (as a result of the continuing housing bust), lack of state income taxes, and a general cheap cost of living will start to attract entreprunuers. In fact, I know first-hand that this is already happening. Add to that the fact that we have not lost our international airport (still one of the busiest in the country) nor the amazing entertainment and dining options. If you can deal with our 3 hot months of summer (which many would suggest are much preferable to somewhere with three months of serious winter weather), you have it made.
With entreprenuers come great ideas. Where you have great ideas, amazing things happen.
But for the forseable future, you’ll still have very high unemployment, plenty of forclosures, and other stressful conditions for a pretty significant portion of the population. This will not cease until natural selection has taken its toll and “thinned out the herd” of Las Vegas residents.
In addition, the people moving to town now didn’t live the boom. They didn’t think it was normal for money to be falling into their lap if they so much as got out of bed in the morning. They are moving here to couple risk taking, hard work and a business friendly environment and will be a lot less likely to assume that a magical jackpot (home appreciation) is going improve their lives.
As I noted, I know because I’m already meeting some of these people. And if they are any indication of what is to come, the city will bounce back nicely and continue to be a very enjoyable place to work, live, and do business.
Your Turn: Think I’m on the money? Is there something I missed? Am I out-to-lunch and you think that Las Vegas is on a slide that it will never recover from? All comments are welcome and appreciated below.