RENO — Back in late January, at the Economic Development
Authority of Western Nevada’s annual State of the Economy, Mike Kazmierski
touted the Reno-Sparks area’s jump in job creation, drop in unemployment rate
and overall economic growth.
A celebratory scene, more than 1,000 smiling members of the
area’s business community filled the room.
A lot has changed since.
Roughly two months later, with the COVID-19 pandemic
slamming the brakes on Northern Nevada’s fast-growing economy, a
working-from-home Kazmierski spoke as part of an April 3 virtual panel
discussing the region’s path to economic recovery, underscoring the need for a
Pointedly, he said schools statewide should be teaching
classes on things like coding and robotics, which he called “the next
generation of skills.”
“That will make it easier to attract the next generation of
jobs and grow the next generation of jobs through our entrepreneurial
activity,” he said.
For this to happen, however, the state needs to properly
fund education, he added.
“This crisis will probably accelerate our transition into
the Fourth Industrial Revolution,” he explained. “Automation and AI is going to
be accelerated, which requires a better-educated workforce at a time when our
state is going to take huge budget hits in the next couple years.
“That will impact their ability to properly fund education,
which is already improperly funded.”
According to Education Week’s 2019 Quality Counts report,
Nevada ranked 48th out of 49 states in school financing, and second-to-last in
public education overall. The state spends about $9,200 per student — for
comparison, that’s a little more than half of Wyoming’s $18,090.
Last June, Gov. Steve Sisolak signed into law a new school
funding formula — until then, Nevada had the nation’s oldest school funding
Additionally, the state redirected funds generated by a tax
on marijuana sales from a rainy day fund to an educational fund, generating an
estimated $119.9 million in additional school funding over the next two years,
according to previous reports.
“We’re giving 30% of our budget, in theory, to education.
The reality is, we’re still at the bottom of the heap when it comes to national
funding,” Kazmierski said April 3, adding that education lobbyists and parents
need to make their voices heard loud and clear by elected officials. “We’re
moving in the wrong direction, so at some point we need to get together as a
state and say education is our top priority.
“I think it really is something that will benefit not just
the here and now, but our economy in the long-term.”
Still, despite the efforts of the 2019 Legislature to update
and increase education funding in Nevada, it remains to be seen how the
COVID-19 crisis will impact funding in 2020 and beyond.
Not long after the April 3 forum took place, Sisolak issued
an order directing state agencies and other recipients of state funding to
prepare for potential budget cuts as a result of reduced tax collections caused
by coronavirus-related business closures.
In his order, Sisolak said agencies should identify a 4
percent cut this fiscal year and a 6 percent cut in fiscal 2021 — and he added
that there could be two additional 4 percent reductions in 2021 if the
Though it will take weeks to determine how deep (if at all)
cuts need to be made, Sisolak said K-12 school funding could suffer a massive
reduction, with the Distributive School Account losing $81.6 million in the
first scenario and $104.8 million if the extended reductions are ordered.
RETRAINING THE WORKFORCE
Patricia Herzog, director of the rural economic and
community development for GOED, said she also foresees the state’s shift toward
robotics and AI being put on a “fast-track” following the COVID event.
In fact, Herzog said her office is discussing the idea of giving folks who are unemployed due to the shutdown of non-essential businesses and cutbacks by companies statewide an opportunity to retrain into skilled positions at manufacturing companies with hiring needs.
“Is there an opportunity for folks to learn some skills and
utilize the resources we have when they didn’t have the time to learn new
skills before and get them back to work?” Herzog asked during the April 3
panel. “These are conversations we’re having in our office right now.”
To that end, Jeff Brigger, director of business development
at NV Energy, said getting people back to work “as safely and as quickly as
possible” should be the first immediate priority for the region.
According to the Nevada Department of Employment, Training
and Rehabilitation, at the time of the April 3 forum, there were 170,798
initial claims for unemployment insurance in the last three weeks of March.
That number as of April 9 had jumped to nearly 245,000.
“We’re looking at 25-to-35% unemployment, potentially,
coming out of this, so getting people back to work is the most urgent need for
the region and community,” Kazmierski said on April 3.
HARD LOOK AT LINKAGES
Tom Harris, director of the university center for economic
development at the University of Nevada, Reno, mentioned the importance of
building “linkages” between rural and urban areas.
He pointed to Tesla and Panasonic’s presence east of Reno in
Storey County at the Gigafactory — which produces lithium-ion batteries — and
the lithium mining occurring in rural Humboldt and Esmeralda counties as a
prime example of developing linkages for the electric vehicle supply chain.
“I think it’s going to make, in the future, a great promise
because people are pushing green energy,” Harris said. “And some days you don’t
have wind, some days you have drought, and every day you have night, so what
you need is battery. That’s the common denominator, and that’s what we (as a
state) can do.”
Added Herzog: “It’s those linkages and connecting through
our state that I think is really going to help us bounce back in our recovery.”
Brigger went a step further and said business and economic
leaders need to reach out to rural communities to “identify more of those
linkages,” before adding: “We can’t lose sight of those potential linkages that
we could take advantage of now and build a better future with.”
Kazmierski noted that all major business organizations
across the state are working together to share information and resources during
the pandemic via the Las Vegas Global Economic Alliance website at LVGEA.org.
Herzog also encourages small business owners to go here and
take GOED’s COVID-19 economic impact survey.
“That information be going to the governor and will really
be helping with the policy-decisions that will be used to help with programs in
the recovery,” she said.