Tesla Motor’s forthcoming battery factory in northern Nevada is expected to create over 20,000 jobs—sparking an unprecedented boost in the state’s population, making a dent in the 7.7 percent unemployment rate and helping the struggling housing market.
The number of new jobs is significant because Nevada has 95,000 unemployed. The four counties nearest to the planned Tesla “gigafactory” in northern Nevada in the Tahoe-Reno Industrial Center – where most of the jobs are expected --have a total of 18,296 unemployed, according to Nevada state demographer Jeff Hardcastle of the University of Nevada, Reno.
Hardcastle called the planned $5 billion facility, scheduled to open in stages and be fully operational by 2017,“the largest factory of its size to be opened in any part of the country in recent memory. “It is the largest economic entity to have such a large population impact in the region.”
Partial production and employment at the plant is scheduled for 2015.
The Nevada Governor’s Office of Economic Development (GOED) said the Tesla factory will create up to 6,500 new on-site jobs with an average wage in excess of $25 per hour. Tesla said it expects to employ 6,500 workers by the eighth year the factory is open.
The GOED forecast 16,000 indirect jobs will also be created-- generating an economic impact of nearly $40 billion over 20 years.
Sixteen percent of the jobs are expected to be in retail trade; 13 percent in wholesale trade; 12 percent in construction and administrative and support services. Professional, scientific, and technical services at 11 percent; food services at 8 percent and Health Care at 8 percent.
Hardcastle also forecast that by 2018, the “Tesla bump” will increase the state’s population by about 4,000 people–with a total increase of 35,000 in the next two decades, an increase of about 1.3 percent of the state population of 2.8 million.
The Teslafactory also is expected to help the Nevada housing market, where one in 520 homes is in foreclosure—one of the worst rates in America.
Hardcastle said that over the next two decades, the state expects to pick up 28,000 immigrants looking for housing—meaning some 10,500 new households.
“It would continue to be a slow recovering housing market without Tesla,” Hardcastle said. “It’s picking up but there’s still some uncertainty out there.”
Hardcastle also said Washoe County, near the factory, will likely see the greatest spike in home purchases and rentals. Some 17,000 units went vacant there between 2000 and 2010.
“You’d expect to see a substantial number of those vacant units to be absorbed in addition to potential to new construction,” Hardcastle said .
The influx of residents also is expected to generate an increase in sales and property tax revenue and could also create an indirect improvement in services such as health care, according to Hardcastle.
The factory is expected to create enough lithium-ion battery packs for 500,000 electric cars by 2020.
Hardcastle said the Tesla factory will create and secure a new “manufacturing base” in northwestern Nevada that has the potential for even more spinoff sectors.
“It may help reinforce some smaller energy and battery firms here,” Hardcastle said.