November 10th: Rebel Business Indicators 👓

Your weekly 5-minute guide to the data and economic news shaping Southern Nevada and the World.

By the numbers

Workforce

22.1 Percent

The amount the Southern Nevada Confidence index dropped in the 3rd quarter after reporting it's highest score in the 2nd quarter.

CBER has been conducting the Southern Nevada Business Confidence Index since at least 2008. The survey asks Southern Nevada Business Leaders questions such as, “What are the most important challenges that you face in your business today?" or "When do you forecast the economy to return to pre-pandemic levels?"

Highlights

ECONOMIC EXPECTATIONS

Southern Nevada business leaders forecasted that the economic conditions for both Nevada and the United States will continue to improve despite the Delta variant spread. However, the Southern Nevada Business Confidence Index showed a negative impact of the delta variant on local business leaders’ economic perspectives as it plummeted by 22.1 percent from last quarter after previously recording its highest score. At 122.5, the total score most closely matches the score from our business confidence survey taken in the fourth quarter of 2015.

EXPECTATIONS FOR HIRING

The index value for expectations on hiring scored the highest among five components with a value of 130.8. This likely reflects that room still exists for improvement in the labor market, while other economic indicators such as retail sales and real GDP have already fully recovered from the COVID-19 recession.

EXPECTATIONS FOR HOME PRICES

The Case-Shiller Las Vegas Home Price Index in June finally surpassed its previous peak from April 2006. It took more than 15 years for the local housing market to recover fully from the previous bubble burst, while the national housing market had already recovered in 2016 and has remained in an expansion cycle for the last 5 years.

Local business executives predict that the upward trend of local housing prices will continue for the fourth quarter with a value of 116.9.

Read the full results of the Business Confidence Survey

Leading Index

10.1 percent

The percentage CBER's Leading Index, a prediction of future economic activity, has increased year-over-year.

The CBER Leading Index uses the Department of Commerce index construction method and provides an indication for the future direction of the current economy. A full description of the methodology used to construct the indexes can be found on our website.

The CBER Southern Nevada leading index increased by 0.2 percent month-over-month (June to July). Initial claims for unemployment insurance (inverted), the ten-year Treasury yield (inverted), housing permits, McCarran passengers, and the S&P 500 increased by 21.0, 0.1, 1.8, 3.1, and 1.2 percent, respectively, from June, signaling positive momentum in the local economy. Commercial permits, nevertheless, fell by 59.3 percent from last month.

On a yearly basis, the index climbed robustly by 10.1 percent. That is, four components initial claims for unemployment insurance (inverted), the ten-year Treasury yield (inverted), McCarran passengers, and the S&P 500 experienced increases of 85.3, 3.5, 157.8, and 35.9 percent, respectively, from last year, while commercial permits and housing permits contracted by 19.1 and 11.5 percent, respectively. The index significantly surpassed its

prior February 2020 peak and climbed higher by 10.1 percent from July 2019.

CBER Leading Index

What we are watching this week:

Tuesday

The NFIB Small Business Optimism Index for October was released. In September, the index fell by 0.9 points to 98.2. According to the report, 49 percent of owners could not fill open positions, and 44 percent of owners raised compensation, which was a 48-year record high reading. Small businesses continued to struggle with the lack of workers for unfilled positions and inventory shortages. NFIB Chief Economist Bill Dunkelberg said, “Small business owners are attempting to take advantage of current economic growth but remain pessimistic about business conditions in the near future.”

The U.S. Bureau of Labor Statistics (BLS) released its producer price index for October 2021. In October, the producer price index for final demand rose 0.6 percent to 129.7 from 128.9 in September 2021. The index, moreover, soared by 8.6 percent from last year, the same as in September and the largest year-over-year jump since the current series began.

Wednesday

Initial jobless claims were released. The claims in the week ending November 6 continued to drop to 267 thousand, hitting another pandemic low. The decline will likely continue as the labor market is still recovering from the COVID-19 recession.

BLS released its consumer price index for October 2021. The consumer price index in October jumped by 6.2 percent from last year, the strongest year-over-year gain since November 1990 and above consensus forecasts of 5.8 percent. The energy index skyrocketed by 30.0 percent from last year, and the food index also soared by 5.3 percent over the same period.

October Federal budget balance will be released. The budget deficit reached the second-highest record of $2.77 trillion in the 2021 fiscal year. The highest budget deficit occurred in 2020 with $3.13 trillion. In September, the United States posted a budget deficit of $62 billion, larger than the consensus forecasts of $60 billion.

Friday

BLS will release its job openings estimate for September. The number of job openings in August declined to 10.4 million after hitting its new record high of 11.1 million in July. The largest decreases occurred in health care and social assistance (-224,000) followed by accommodation and food services (-178,000) and state and local government education (-124,000).

The University of Michigan’s consumer sentiment (preliminary) for November will be released. In October, the consumer sentiment index revised up to 71.7 from a preliminary of 71.4, benefiting from a positive impact of higher income expectations and receding coronavirus.

Notable corporate earnings this week:

PayPal Inc. (PYPL), Monday

Wynn Resorts Ltd. (WYNN), Tuesday

adidas (ADDDF), Wednesday

Wix.com Ltd. (WIX), Thursday

Markets Insider

Last Week's Poll Results are in!

When are you planning on doing your holiday shopping this year?