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New Report Says Secretary of State Data Indicates Job Market Stabilization and Potential for Expansion
Applied Analysis analysts say numbers provide insight to economic movements and early warning signs for future growth
Posted Date: 3/10/2011
FOR IMMEDIATE RELEASE
Contact: Pam duPré
(775) 684-5748
pdupre@sos.nv.gov

View the full report here.

(Carson City, NV; March 10, 2011) – While anecdotal reports and selected economic indicators suggest economic conditions may be improving, the latest data sourced to the Nevada Secretary of State’s office confirms the worst of the declines are in the rear view mirror and potential for future expansion may be on the horizon.

A new study conducted by Applied Analysis, a Nevada-based research and analysis firm, identified new business entity filings as a leading indicator of future economic activity. With all new businesses to the state required to register, entity filings with the Secretary of State’s office tend to indicate the level of investment taking place in the community. During historical economic cycles, an improving number of new business entities ultimately led to job creation. The reverse was also true as the economy turned toward recession.

At Secretary of State Ross Miller’s request, Applied Analysis looked at the number of new business filings in the last quarter of 2010 and noted they had turned positive for the first time since mid-2006. Should historical trends hold true to form, general economic growth – including increased stability within the job market – should follow. When the new entity filings are charted with employment figures, it becomes clear that the new business filing statistics kept by the Secretary of State’s office may be a reliable leading indicator of future economic activity. The conclusion is supported by what Applied Analysis identified as a lagging indicator - the filings that entities must submit on an annual basis once they are initially formed.

According to Applied Analysis Principal Jeremy Aguero, the research firm has analyzed hundreds of economic indicators and concluded that new business filings reported by the Secretary of State’s office provide meaningful insight and may even be an early warning system of future economic instability. Aguero also indicated that since these data have not been reported on a recurring basis, they may have been overlooked in the past. The Quarterly Economic & Business Activity Report generated by Nevada Secretary of State with the support of Applied Analysis is expected to be published on a recurring, quarterly basis.

“This analysis demonstrates that there’s a previously unrealized value to the information my office is generating and storing,” said Miller, whose office is the gateway for any business entity that wants to establish a business or incorporate in Nevada. “It’s clearly a resource worthy of ongoing analysis and evaluation. Whether it’s the private or public sector, economic data that proves to be indicative can provide insight into future trends, helping us to prepare for what lies ahead.”

Miller continued, “This is a great example of government’s responsibility to not just store information, but to make it available to the public in a way that’s relevant and has value to them. That’s the reason my office is becoming increasingly active in helping to expand and diversify Nevada’s economy. It’s why we developed the comprehensive website WHYNEVADA.COM that explains all the advantages of doing business in Nevada. It’s why we’re developing the ground-breaking Nevada Business Portal, and it’s why we will continue to fulfill our obligation to go beyond just keeping records. Unless we also disseminate it and provide some context and analysis, we’re only doing half the job.”

“While one data point in a sea of information cannot provide certainty in today’s uncertain world, it is important to note the information shared by the Secretary of State is valuable to not only our economic analysis but the community. We will continue to monitor these trends over time and evaluate their relevance to actual economic market performances. With selected sectors of the economy likely to continue to face challenges and weakness, the aggregate business entity filing data is somewhat promising. Should these data continue to trend upward throughout 2011, historical trends would suggest broader economic improvements are on the horizon.”

“My office is the third-largest source of revenue for the state, most of which is generated from business entity filings,” Secretary Miller added. “This data will also help us make better revenue projections that are so critical to the governor and legislators as they struggle with funding essential state services.”

The Quarterly Economic & Business Activity Report was prepared by Applied Analysis at no cost to the state using data provided by the Office of the Secretary of State.

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