The economy of Reno and Sparks continues to perform very well, but it fell out of the list of top-performing cities in the closely watched annual rankings by The Milken Institute.
Last year, The Best Performing Cities report ranked the Reno region No. 4, based on its economic performance during 2019. In the newest rankings released on Wednesday, it fell to No. 18 based on its 2020 performance.
That ranking, which is just outside what The Milken Institute defines as “Tier One” economic performance, places Reno one place above Kennewick, Washington, and one place below Colorado Springs, Colorado.
Cooling job growth in the Reno area was a major factor in the slide in the rankings. Between 2014 and 2019, Milken analysts said Reno ranked second in the nation in job growth. In the most recent 12 months — a period which included big job losses in hospitality with the onset of the pandemic — it ranked 106th.
Wage growth in the Reno-Sparks area showed a similar cooling after strong performance from 2014-2019.
Housing affordability also acts as a drag on the region’s economic performance, the Milken analysts said. Their analysis is based on whether people spend more than 30% of their income on housing. On that basis, Reno ranks in the middle of the pack on housing costs compared to other cities.
The decline in Reno’s ranking runs counter to the trend that saw strong performance from mid-sized cities in the Intermountain West.
Among the Western cities in the top grouping were Provo (No. 1), Salt Lake City (No. 4), Boise (No. 6), Phoenix (No. 7), Ogden (No. 9), Denver (No. 11) and Fort Collins (No. 12).
Common elements of those top performers, The Milken Institute said, are housing that’s affordable in comparison to wages, vibrant technology sectors, solid wage and job growth and strong investment in broadband and other technology infrastructure.
Las Vegas, where the economy was particularly hard hit by the pandemic, ranked 88 in the most recent study, down 44 points from the previous year.