With or without Tesla’s solar battery gigafactory under construction in the Tahoe-Reno Industrial Center, Reno/Sparks is headed for explosive growth, according to Mike Kazmierski, CEO and president of the Economic Development Authority of Western Nevada (EDAWN).
During his presentation at the Nevada Economic Development conference, Kazmierski presented a glimpse of an economic impact study — the EPIC report — to be released in mid June.
“Even if Tesla went away, we’d still see more growth than we’ve ever seen,” he said.
Tesla will bring 6,500-plus jobs to the region, but that will take 10 years for all those positions to be filled, he said.
The smaller businesses coming to the area, along with increases at established businesses — returning employees along with new positions added — will bring 11,000 jobs in only two years, Kazmierski said.
Currently, the area has a 6 percent unemployment rate.
“If the (job growth) trend continues, we’re going to hit full employment early next year,” he said.
The number of companies considering moving to the area who actually visit has increased from an average of 4.2 per month in 2011 to an average of 11 per month so far in 2015.
“Our goal is to get companies to come and see the area,” Kazmierski said of EDAWN’s mission. “More than 70 percent of the time, they decide to bring their business to the region, if they have come to see the area.”
When they see, they have a “wow” reaction, he said.
Currently, EDAWN is closing out deals with 140 companies to move to the area.
Fifty-two percent of companies relocating to Reno are in the manufacturing sector.
“We’re now on the radar as the manufacturing center of the West,” he said.
While many companies moving to the region are relatively small, Tesla is not the only mega-catch.
Switch’s SUPERNAP is planning a $1 billion, 3 million-square-foot data center at TRIC that’s going to connect Reno with Las Vegas and eventually Los Angeles and the Bay Area with a “super loop” fiber optic network.
And bring thousands of technology jobs.
The community needs to be ready for explosive growth, which is going to put pressure on housing, traffic and schools.
“If we wait until it’s broke, it’s going to be broke for a long time,” Kazmierski said.
A reduced inventory of houses, especially rentals, is already driving up housing costs that cut into real wages.
“(Contractors) here don’t believe people are coming,” he said. “Their attitude is ‘we’ll build when they come but not before.’”
Schools also need to get ready.
In the modern economy, manufacturing means robotics and other technologies.
Employees will need higher-level degrees to meet the demands.
For the coming technology jobs to benefit people who already live here, local schools need to equip students with the skills needed for the new job environment.
Truckee Meadows Community College and the University of Nevada, Reno, are building programs to support jobs for Tesla, Kaszmierski said, but elementary and high schools are in dire straits. “Our schools are falling apart and there’s not enough funding to fix it.”
Businesses — both those coming and those already here — have more difficulty finding qualified applicants, so new hires need more training. Retraining qualified employees will also be more difficult.
“They’re not happy if they’re losing employees,” Kazmierski said. That will increase the pressure on northwestern Nevada government and agencies to work harder to retain companies.
Reno/Sparks needs to become an attractive environment to retain Millennials and attract entrepreneurs.
It’s already started.
Reno recently hosted Next City’s 2015 Vanguard Big Idea Challenge, which brought young urban leaders to the city.
“Now we’re getting national recognition,” Kazmierski said.
Downtown is the weak link and needs to be connected to UNR to develop a start-up hub, he said.
Reno/Sparks has challenges ahead in managing the expected growth. But the benefits are substantial.
The types of manufacturing jobs being added will help Reno weather future downturns in the economy, Kazmierski said.
“We are not like the rest of the U.S. We are growing jobs with staying power,” he said.
“We are moving into diversification that allows us to weather a recession better than (we did) the last one.”