The Las Vegas Global Economic Alliance has launched a three-year strategic plan to diversify the local economy by attracting higher-wage industries, marking the most coordinated diversification effort since the COVID-19 pandemic exposed the city’s vulnerability to tourism shocks. The plan’s “North Star” is to increase higher-wage trade-sector industries, according to a summary shared with the Las Vegas Sun.

The Diversification Problem

Las Vegas scores 74 on the Hachman Index, a metric that measures economic diversity, with 100 being the most diversified. That translates to roughly 26% of the local economy being tourism and hospitality — a concentration that leaves the city exposed to external shocks, as the pandemic demonstrated. Peer markets like Orlando, Florida, and Nashville, Tennessee, sit below 20% and 15% tourism reliance, respectively. “Everybody cares about diversifying the economy,” said LVGEA president and CEO Danielle Casey, “but not alignment on what the real problem is, what we need to address, and how we actually move the economy forward.”

Five Target Industries

The strategic plan identifies five target industries for growth, selected based on analysis by a third-party site-selection company that evaluated Las Vegas through the lens of companies exploring the region for relocation. Casey emphasized that the goal is not to shrink tourism but to grow other sectors alongside it. “Our goal is to not reduce the amount of tourism and hospitality in our market, but increase the amount of other target industries,” she said. The plan aims to raise Las Vegas’ Hachman Index score to 76 or 77 and increase the number of high-paying, high-quality jobs that can sustain families without relying on tips and seasonal visitor fluctuations.

Stakeholder Alignment

The plan was formed with input from stakeholders, the LVGEA board of directors, other consultants, and the site-selection firm. That outside perspective helped the alliance identify which sectors are most likely to succeed given Southern Nevada’s workforce, infrastructure, and geographic advantages. The alignment represents a departure from past diversification efforts that lacked coordination among economic development agencies, educational institutions, and private-sector leaders.

Data Center Boom as a Case Study

The diversification push already has momentum in one sector: data centers. Switch received tentative approval from Clark County commissioners to add another data center to its Las Vegas megacomplex, and another data center operator recently purchased additional land in Southern Nevada for $86 million. The growth reflects Las Vegas’ low energy costs and fiber connectivity, assets that the LVGEA plan seeks to leverage across additional industries to build a more resilient economic foundation.