Education, diversity key to Nevada's recovery

LAS VEGAS - After years of neglecting its public schools and high-tech sectors to dote on a mighty gambling industry, Nevada now needs to get smart to get rich, a sociology professor told state leaders Friday.

The Silver State's all-consuming love affair with casinos has made Las Vegas the least educated metropolitan area in the West, overwhelmingly dependent on the wealth of other states and vulnerable to every economic tremor, said Robert Lang, director of Brookings Mountain West at the University of Nevada, Las Vegas.

"We are way more dependent on consumer spending than anywhere else," said Lang at an economic summit attended by lawmakers, business leaders and policymakers.

The Nevada 2.0 conference addressed a topic older than many of the casinos on the Las Vegas Strip: How can Nevada, a state that long ago tied its future to an industry that demands excessive spending, grow into something more?

Lang said businesses don't want to create jobs in areas that do not boast able work forces. Roughly 19 percent of Las Vegans obtained a bachelor's degree, compared to 31 percent of people in northern New Mexico and 27 percent in the Phoenix area, Lang said.

Nevada's hard fall in recent years has added a new sense of urgency to the decades-long call for expanding the state's economy beyond gambling, tourism and construction, lawmakers said. The state's 14.3 percent unemployment rate is the highest in the nation. Some estimates predict the state's jobless rate will hover near 13 percent through 2012.

Nevada also suffers from record bankruptcies and foreclosures.

"We've been on the same course for decades, and it's clear to everyone here that it is time for a change," said Nevada Assembly Speaker John Oceguera.

State Senate Majority Leader Steven Horsford said Nevada must improve its public schools.

"You have to have an educated work force for these new industries that you are looking to attract," he said.

A Brookings Mountain West overview of the state portrayed Nevada as a volatile gambling haven.

When tourists flocked here to empty their pockets in casinos, Nevada prospered and ignored warnings that its one-note economy was not viable. Construction flourished. Unskilled workers made middle-class wages. State coffers were fat from gambling taxes.

Lang said Nevada has ranked behind eight other western states for industrial diversity since at least 1999. More than 45 percent of Nevada's work force was employed in retail, leisure or construction fields in 2009.

Those industries shrank after the recession hit. Between November 2009 and November 2010, Las Vegas lost 13,400 construction jobs, or 23 percent. Reno lost 2,700 jobs, or 26 percent, according to a survey by the Associated General Contractors of America.

"That track is not sustainable," said Lt. Gov. Brian Krolicki. "We hit the wall, and we need to retrain and redirect some of these talented people."

A state commission on economic development suggested Nevada offer incentives to attract film, television and digital media industries. It identified the medical field and international business market as untapped economic engines.

The plan also relied heavily on public dollars in a state with a limited tax base.

It suggested Nevada grow its national defense sector through contracts with the federal departments of defense, homeland security and energy, called on the federal government to transfer land for the development of renewable energy projects.

Business owners and government officials from Dallas, Denver, Phoenix and Salt Lake City who addressed the summit suggested any plan must include some focus on education. The unemployment rates in Texas, Colorado, Arizona and Utah range from 7.5 percent to 9.4 percent.

"You can never get out of a recession by doing anything," said Tom Clark, executive vice president of the Denver Metro Chamber of Commerce. "What you do in a recession is prepare for the recovery."

Clark said Colorado restructured its oil-based economy after an energy bust in the early 1980s. Denver communities banded together to sell the region to avoid infighting among individual communities, he said.

"You can't steal one another's prospects," he said.

Ted McAleer, executive director of the Utah Science Technology and Research initiative, said the Beehive State has strengthened its economy by investing in state research facilities focused on creating new technologies.

Nevada can't depend on glitz to sell itself to businesses, he said.

"They are not going to come to Nevada because you've built the coolest new building," McAleer said. "They are first going to look at the human capital."