Growth remains on the menu for Reno area. But high housing costs and income disparities between new and existing residents reflect its challenges.
By Jason Hidalgo, Reno Gazette Journal, February 14, 2025
Growth remains on the menu for Reno and Northern Nevada in the next decade as the region continues to attract new jobs while further diversifying its economy with manufacturing and technology.
Reno is no longer the cheap destination it used to be for businesses, however. High housing costs threaten to undermine the region’s competitiveness against regional rivals such as Las Vegas and cities in nearby states while affecting locals’ quality of life. The population growth of the area, while still in positive territory, is also expected to slow down compared to the previous decade.
Population growth, jobs, local infrastructure and housing affordability were just some of the issues addressed on Thursday during the annual luncheon of the Economic Development Authority of Western Nevada in Reno.
While the organization gave a positive review of the economy overall, it also highlighted key issues that the region faces as it moves into the next decade — issues that need to be addressed for Northern Nevada to maintain its quality of life, said Taylor Adams, president and CEO of EDAWN.
“It’s not productive for us to just talk about growth, growth, growth, because that’s what creates real angst in the community,” Adams said.
“Our goal is to forever be improving … so that people can afford to live here and enjoy all of the things that contribute to quality of life here.”
The large income disparity between new and existing residents, for example, shows the region’s success in adding higher paying jobs. However, it also reflects the challenges that longtime locals face in competing against deeper-pocketed rivals when buying a house, especially with median home prices skyrocketing in the last 10 years.
“It’s a little bit of a double-edged sword,” said Brian Gordon, a principal with Nevada-based data and analytics firm Applied Analysis, which conducted the economic study for EDAWN.
“It’s a benefit because households (who already own a home) have generated a significant amount of wealth as home prices have increased,” Gordon said. “But the premium pricing we experience in the housing market as locals who are already here — it’s a challenge to get into the market.”
The good: Northern Nevada remains attractive to job creators
Despite facing some economic headwinds in 2024, the greater Reno metro area remains an attractive place to do business for companies.
Last year, EDAWN recorded more than a hundred qualified leads from companies interested in checking out the the region for a potential move or expansion into the area. Those leads resulted in 133 site visits to the region — for an average 11 site visits per month.
The rate is an improvement over the eight to 10 site visits seen at various points of 2023. The numbers are also a significant improvement over the four to six site visits in 2022, when the pandemic hampered business travel.
Prior to the pandemic, EDAWN previously targeted eight to 10 site visits per month, which the organization routinely achieved, according to Taylor.
“The pandemic was a bit of a reset for all of us,” Taylor said. “But we averaged 11 (site visits per month) through 2024 and have accelerated beyond that number early in 2025.”
The Reno region’s attractiveness to other companies boils down to its business-friendly economic and tax environment as well as its location. In addition to having easy access to Western states, it is also close enough to the Bay Area’s tech hub for companies to expand into while taking advantage of lower costs.
The bad: Reno area’s population growth is slowing down compared to the previous decade
For residents who have been dealing with the impact of Northern Nevada’s growth on housing costs, infrastructure and local resources, a slowdown in population growth would likely be a welcome development.
For economic development, however, going too far on the opposite end of the population growth spectrum can be a sign of future issues such as reduced consumer demand and a smaller employment and economic base to draw from.
It could also be a sign that other regions are poised to steal Nevada’s thunder.
For example, Nevada was the fastest growing state from 2001 to 2007, according to U.S. Census Bureau data. Although the state fell into the 30s rank-wise during the global financial crisis and COVID-19, it showed an amazing amount of resiliency, nabbing the No. 1 and No. 2 spots as recently as 2018 and 2019.
By 2024, Nevada also managed to climb its way back to No. 5 after a steep drop in its growth ranking during the pandemic.
Northern Nevada, which has succeeded in diversifying its economy more than Las Vegas, has especially been quick to recover.
From 1969 to 2023, the Reno metro area’s population grew by 344%., based on census data. That’s higher growth than Mountain West region rival Boulder, Colorado, which grew by 152% during the same period.
Northern Nevada’s growth, however, is projected to slow down.
In the 11 years leading to 2013, for example, Northern Nevada added 90,280 people for an average annual growth rate of 8,207.
In contrast, the region can expect to see its population grow by 61,500 people from 2024 to 2033, according to population projections by the Nevada state demographer’s office. That’s an average rate of 6,150 people every year.
EDAWN’s Adams pointed to one culprit for the slowdown.
“It’s the absence of housing starts in the community,” Adams said. “We don’t have anywhere to put anybody.”
“Make no mistake, if we can solve that problem, you’ll see our population grow to meet the employment needs of our future,” Adams said
Also, while Northern Nevada might not be growing as fast as it used to, projections still show steady growth in the next decade. Overall, Northern Nevada maintains a strong economic profile, according to Gordon of Applied Analysis.
The question is just exactly what kind of people a community is bringing in.
“The pace of growth slowing is perfectly acceptable,” Gordon said. “At some point, it becomes less about quantity and more about quality.”
The good: Northern Nevada is bringing in higher wages and more technical expertise
After Nevada’s construction and housing sector was decimated by the 2008 recession, then-Gov. Brian Sandoval restructured the state’s entire economic development system to focus on bringing in high-tech jobs and a more skilled workforce.
The move included the creation of the Governor’s Office of Economic Development, which also helped address some of the competition and in-fighting between various regional economic development organizations.
One of the beneficiaries has been Northern Nevada.
The region scored an economic coup when it landed an Apple data center in 2012 and Tesla’s first Gigafactory in 2014, which is a joint venture with global company Panasonic. Since then, other big names followed, including players from outside the area such as Google and Switch. The region’s transformation also fueled locally grown enterprises such as battery materials company Redwood Materials, which was founded by a former Tesla executive.
In addition to beefing up technical training and education for existing residents, Northern Nevada’s tech boom also brought in plenty of highly skilled newcomers to the area.
Although the region initially struggled to supply workers for high-tech companies, the state as a whole posted the third-highest gain in college graduates moving into the state in 2023 at 111%, according to Applied Analysis. Only Washington state and North Carolina — which have a highly developed technology sector — saw a higher share.
Reflecting Northern Nevada’s growth as a supply chain and manufacturing hub, the trade, transportation and utilities sector also grew as the Reno metro area’s top employer from 39,300 employees in 1990 to 58,900 in 2024, according to the Bureau of Labor Statistics.
In contrast, leisure and hospitality, once the top employer in the area, fell from 36,400 to 34,500 workers during the same period.
STEM degrees, which include science, technology, engineering and mathematics, also account for nearly a third of degrees awarded at the University of Nevada, Reno, according to the latest data.
The growth of STEM jobs in the area has been especially helpful for homegrown startups and companies, according to Adams.
“We’ve become the birthplace of groundbreaking technology, companies like Redwood Materials, Aqua Metals, Dragonfly Energy, Ridgeline, Positron and many others,” Adams said.
“These companies are reshaping their futures right here in our region.”
The bad: Reno seeing an education and economic divide between newcomers, existing residents
The increase in technical and high-paying jobs means more opportunities for locals to step up the economic ladder.
But for people in lower-paying jobs such as the service industry, the growth in tech and population is leading to a case of the haves and have-nots.
The typical household income for current residents in Northern Nevada, for example, was $84,282 in 2023, according to Applied Analysis. In contrast, workers coming into the area for new job opportunities have a household income of $123,031.
The income disparity is making its presence felt in the housing market, where longtime locals who have yet to buy a home experience a disadvantage in purchasing power. It has also led to a significant hit to housing affordability.
In January 2017, the median home price for an existing home was $320,000,according to Sierra Nevada Realtors. By July 2024, it reached an all-time high of $672,500.
The high home prices have dented Reno’s former reputation as a low-cost destination for companies.
In 2024, for example, the median home price for Reno was above $600,000, according to the National Association of Realtors. That’s far above Las Vegas, which was under $500,000.
Home prices in Reno were also higher than regional rivals such as Phoenix, which was below $500,000 and Tucson, which was below $400,000.
Even Dallas, Houston and San Antonio, which enjoy incentives from the state of Texas’ deeper economic development pockets compared to Nevada, have median home prices below $400,000.
Adams was not concerned about the high cost of housing’s impact on business attraction.
“From an attraction standpoint, we don’t see it as a challenge … because companies are finding us and still want to be here,” Adams said.
“Where we see it as a challenge is for our existing residents,” Adams added. “We still believe that the American Dream runs through homeownership.”
Since 2015, for example, the typical Northern Nevada household spends more than half of its income in housing. Anything above 30% is considered a sign of being housing cost burdened. One solution is to increase housing starts or construction to increase supply and lower prices.
With the cost of a house jumping from $392,241 in 2022 to $428,215 in 2024 thanks to inflation and higher building costs, however, relief is still easier said than done.
Add mortgage rates that have increased to 7%, and the cost of home ownership goes up even more.
Another solution is to create more high-paying jobs.
Household incomes in Northern Nevada for longtime residents have already increased from $56,457 to $84,282. The increase, however, has not kept pace with the cost of housing.
Training and education is another option for raising residents’ wages. In addition to earning more, newcomers to the area also have higher education levels, with 48% having degrees vs. 34.5% for existing residents.
“This is why we’re focusing so much on high paying jobs and, more importantly, working on attracting high-paying jobs that don’t necessarily require a college education,” Adams said.
In response to concerns about growth, Adams noted that growth is necessary for any community to flourish and stay vibrant.
The question is what kind of growth you’re chasing, he said.
“We’ve got to grow anyway but it’s not enough to just grow,” Adams said. “If we solve housing and do it in a way that’s sustainable while working on infrastructure, we can safeguard our quality of life, not just now but for the future.”
How that can be done in Northern Nevada, however, remains the million-dollar question.