Economic Development Chief Predicts Strong Recovery After COVID-19
For roughly a decade, Nevada has maintained one of the fastest-growing economies in the country. But with non-essential businesses across the state shuttered due to the threat of the novel coronavirus, that economy is likely going to take a hit. Just how big of an impact COVID-19 will have remains to be seen. To suss that out, KUNR’s Paul Boger spoke with Mike Kazmierski, CEO of the Economic Development Authority of Western Nevada about the state’s economy and what recovery may look like.
Boger: In this state, we seem to focus a lot on gaming and tourism as the main economic drivers, but they’re not the only ones affected by the governor’s order to shut down non-essential businesses. Many, many small businesses are also affected. Are you concerned about that?
Kazmierski: Certainly, it is a concern. Many of our small businesses have a short runway or a fairly limited amount of funding. So to remain open when [there’s] little or no customer interaction or activity makes it hard for them to survive. Recently the state was announced as a disaster zone for small businesses. Small business loans [are] something that will likely keep many of these businesses alive, through what we see as a short-term pullback.
Boger: What are you hearing from those business owners who are affected by this, and what are you telling them?
Kazmierski: Any small business that counts on customer interaction — restaurants, bars and even retail — are in for some significant revenue decreases. We can expect that to continue for at least another 30 to 90 days before things start to pick up. It could be even longer, and if a small business is counting on that revenue to make their payments for rent or other things, they are going to be in serious difficulty. Which is why the SBA loan is so important.
In addition, many of those employees don't have backups. When the restaurant’s empty or closed, the restaurant can't pay them for the time that they're not working. They're going to be in a little bit of a lurch. There are some jobs opening up. For example, Amazon is hiring additional people. There are some potential jobs in the distribution areas that are not nearly as affected as the small business and customer service areas, but it is still a problem and many of our small businesses are likely to not be able to weather this storm. If they're close right now and they don't get help, they probably won't make it.
Boger: What are you hearing from the state?
Kazmierski: Well, the governor and the team at the state have been right in the mix of this from day one. They've been very aggressive [in] laying out policies and procedures to help those most impacted. I have talked to the state economic development team on a regular basis. They're working with federal entities to ensure that these low-interest loans are available and that our small businesses especially take advantage of them. So at this point in time, I think the state is doing everything they can to identify [and] prepare for the impacts of the virus and help wherever they can.
Boger: Is there more that needs to happen?
Kazmierski: Clearly the most important thing is testing. It is a national problem. We have a potential solution, here in the state, that we're working on now with Renown CEO Tony Slonim. But if people don't know who is infected, then it's much more difficult to quarantine or control the spread of the virus. That's a national problem that I think many companies are working on now to help us address it.
Boger: I’m curious after this is all said and done with, how long do you think it’s going to take for Nevada to pull through the worst of this economic turmoil?
Kazmierski: I'm not an economist, but I can tell you this is a once in a lifetime event. It is profound. It will affect our communities for longer than the few months that'll take us to get through the worst of it. It's good to change the way we do business.
That said, we have a strong economy. Our community works well together and I'm confident that we will get through this in [the] not too distant future. In 90 days, we'll start to see a fairly reasonable recovery. And within a year or so, things should be close to back to normal with the changes we're going to have to make in daily life, which may include addressing viruses like this in the future.