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Eight of the index's 10 indicators declined from the same month a year ago and the two positive indicators -- commercial building permit valuation and visitor volume -- contributed little to the index after weighting and seasonal adjustment.
The index dropped from 126.23 in November and from 129.56 in December 2008.
Improved performance in the gaming sector will be a key component to future job growth in Clark County, said Bob Potts, assistant director of the research center at University of Nevada, Las Vegas. Until visitor spending picks up, he expects continued weakness in the tourism sector.
"What I'm interested in is not so much the percent change from year to year," he said. "Right now, we're comparing bad against not-so-bad. That's when the percent change gets really messy."
Declining taxable sales and gaming revenue -- two critical components of the index -- will have dire consequences for state revenue forecasts, Potts said. While the levels of gaming revenue and taxable sales are going to be lower, the percent change should start to decrease, he said.
"Are we getting to the bottom of this? We need to get to the point where we're comparing apples to apples and we won't have this huge percent change," the economic analyst said. "I want to see March numbers on taxable sales and gaming. If we still have double-digit change, we're going to be in trouble."
The economic index, compiled by the UNLV research center, is a six-month forecast from the month of data, based on a net-weighted average of each series after adjustment for seasonal variation. December's index is based on October data.
The accompanying chart includes several of the index's categories, along with data such as new residents and employment and housing numbers, updated for the most recent month for which figures are available.
"It's still two steps forward and one step back, but I think you are seeing signs of stabilization in Vegas," said Jeff Thredgold, principal of Utah-based Thredgold Economic Associates and economic consultant for Nevada State Bank. "People who have confidence in keeping their job may go to Vegas and play some cards and go to the casino, when a year ago they were going nowhere."
Stronger national and global economic growth will show up in Las Vegas measures of tourism and gaming revenue and hotel room rates, he said.
"I think the city can look to things getting better more than things getting worse," Thredgold said, though there are risks such as mortgage rates going up and higher inflation.
The Clark County Construction Index rose slightly in October, but the five-month moving average is down from both September and from a year ago. Looking at underlying series that make up the index, construction employment has dropped to 2002 levels, while residential and commercial building permits are at their lowest levels since the mid-1980s.
Demand for construction design services continues to decline, a report from the American Institute of Architects showed. The Architectural Billings Index dropped more than three points in November after reaching its highest mark since August 2008.
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