Part 1: Reno/Tahoe is About to Boom

 In Tahoe Professional News
Apple Inc. logo.  White apple on grey background

The first domino to fall into place was Apple.


This post is the first in a two-part series regarding major business developments in our area.

Perhaps you’ve heard; big things are happening around Reno these days. In 2012, Apple built a data center in Reno. While its workforce isn’t large, the data center sparked interest for other businesses to relocate or start-up in Northern Nevada. Recently, Amazon relocated a large warehouse to an area just North of Reno, which provides approximately 1,000 jobs to the local community.

Jumping forward to mid-2014, Governor Sandoval and the city of Reno won over Elon Musk of Tesla, which has already started building what is being called a “Gigafactory” in the Tahoe-Reno Industrial Center. It will be the largest lithium-ion battery plant in the world. How big? About five million square feet, or roughly one mile long and 70 feet tall.

According to Tesla, the factory, once completed, will provide 6,500 direct jobs. This count does not include the laborers, construction workers, various contractors, and shipping personnel needed to build such a colossal structure. Stay with me, because now we’re going to look at the numbers.

Other jobs will be needed to support Tesla. A few examples include: shipping providers, part and component suppliers, security personnel, janitorial services, and more. These types of jobs are called indirect or secondary jobs. According to the State of Nevada, these indirect jobs will result in 7,814 additional jobs for the region.

Man in button-up blue shirt standing next to a partially completed Tesla vehicle in a white and clean factory.

Everyone smiles in a Tesla factory.

Those jobs will in turn create even more opportunities for workers. Called induced or tertiary jobs, these jobs include things like grocery, restaurant, retail, entertainment, housing construction, concert staff, emergency services, and other public workers. Governor Sandoval’s analysis projects tertiary jobs to reach approximately 8,402. This approximation brings the total jobs from the Tesla plant to 22,715!

To get these numbers, analysts use what is called a multiplier effect. Basically, an economic impact model is created based on past performance in various markets for similar industries. With the numbers the state of Nevada has provided, analysts are using a 3.49 multiplier. This means that for every job Tesla creates, 2.49 more will be created. Critics of course have varying thoughts on this multiplyer ranging from a low 1.5 to a high 4.3.

amazon.com logo with yellow convex arrow beneath the word.

Amazon has migrated to Reno as well.

As Governor Sandoval has said, “The list of companies wanting to do business in Nevada keeps growing.” His statement is proving to be true, since battery mega-giant, Switch announced its plan last week to construct a massive data center right next to the Tesla building.

This building will be three million square feet, and will include a “supernap” project which will develop a 500-mile fiber optic network called the “superloop,” connecting Reno, Las Vegas, Los Angeles, and San Francisco. It will massively increase the speed of information travelling between the cities. Switch says it will place “50 million people within 14 milliseconds of data, with information moving between Reno and Las Vegas in only 7 milliseconds.”

What does this have to do with Tahoe? How does this affect us in any way? I’ll let you know in part two coming soon. Please let us hear your thoughts in the comments below!

Travis Rougier is a modern day Renaissance man. Tech guru. Real estate expert extraordinaire. Purveyor of Amazing Things. Heliophile. Father of three. I write on my own blog here.

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