Nevada’s middle class is faring better than any other state in the nation, according to an economic report from Forbes.
The Silver State scored the highest on the magazine’s new “American Dream Index,” that measures seven key economic factors impacting the middle class.
Reno Public Radio’s Noah Glick chatted with Kurt Badenhausen, a senior editor who helped create this rating system, to learn more.
KUNR: Walk me through the American Dream Index. What is it and how did you come up with it?
Badenhausen: When Donald Trump was first elected, we started thinking about first of all, how did this happen? It was such a monumental occasion and surprised so many people. And we wanted to get at how it happened.
And also we wanted to track his performance. He made a lot of promises about putting America first, bringing manufacturing jobs back to this country, so we wanted to really create an economic scorecard that’s really beyond just gross domestic product.
So we hashed out factors that we can look at on a month-to-month basis that’s also available on a state-to-state basis. So we settled on a handful of different factors:
- Bankruptcies: both commercial and personal
- Building permits: levels and trends
- Goods-producing employment
- Labor participation rate
- Unemployment insurance claims
Why did you decide on the components that you mentioned as the components of this index?
Well, a lot of them surround jobs. We look at mass layoffs, which really get deep into the psyche of certain areas. You hear about 500 people being laid off in your area, that’s really a heavy burden that plays into the psyche of an area.
So we thought these factors really got into the heart of middle-class prosperity. So we launched it in March, January 2017 the index is starting at 100. We saw on a national level, there was an uptick from 100 to 105.
I do want to take a look at Nevada. The Silver State got the top spot among all the states you measured. So what makes Nevada score so well on this index?
It rates highly thanks to strong levels of construction and startup activity, along with gains in goods-producing jobs. Nevada is traditionally a state of booms and busts and right now, things are booming. Tourism has picked up again and there is a lot of growth going on in Nevada.
The biggest coup was Tesla’s decision to locate its gigafactory outside of Reno, which is supposed to add as many as 10,000 jobs directly with the factory. And then there’s this mushroom effect where as many as 30,000 jobs could be added to the region.
I write about sports business a lot for the magazine so I see what’s going on with the sports arena with the new NHL team coming in the fall, and opening up their checkbook to attract the Oakland Raiders with $750 million of public money. So that was a big win for the city [of Las Vegas] and the state as a whole.
Do you anticipate that states will fluctuate on these scores, or do you foresee a more steady consistency?
On a national level, we’re not going to see huge movement. But on a state-to-state basis, you absolutely can see some bigger swings, particularly those states that are very dependent on one sector.
So we’re looking forward to tracking this, and we’re looking to explore more of these stories and dig deeper. The idea isn’t just to be a monthly rollout of some new numbers, but really get into what’s going on going forward.
Kurt Badenhausen is a senior editor at Forbes, who writes about the business of sports. He helped create the magazine’s new American Dream Index.