Posted on 08/22/2009 9:25:16 AM PDT by BradtotheBone
Nevada's unemployment rose to 12.5 percent in July, while joblessness in especially hard-hit Las Vegas surged to 13.1 percent. It’s the highest jobless rate both statewide and locally since the state began tracking data in 1976.
No “green shoots” for Nevada.
As economists and policymakers nationwide hover over the tender little economic tendrils that herald recovery from recession, Nevada’s economy looks as barren as the Mojave Desert.
As a trickle of data points to the national downturn’s end, Nevada’s economy continues its descent. Joblessness in the Silver State jumped to 12.5 percent in July, while unemployment in hard-hit Las Vegas leapt to 13.1 percent. Both state and local unemployment scored their highest levels in 33 years of tracking, the state Department of Employment, Training and Rehabilitation said today.
Nevada’s jobless rate was more than double its level in July 2008, when 6.6 percent of the state’s residents were out of work. In Las Vegas, unemployment was at 6.8 percent in July 2008.
Bill Anderson, chief economist with the employment department, said Nevada remains stuck in the longest, deepest recession since World War II, and recent labor-market trends don’t signal any improvement.
Joblessness in Nevada jumped 1.9 percentage points from April to June, the biggest three-month spike on record. Nevada shed nearly 28,000 jobs in the three-month period, including 15,000 jobs from June to July alone. Nationally, unemployment has moderated, declining from 9.5 percent to 9.4 percent between June and July.
In all, 179,300 Nevadans are unemployed and actively seeking work.
“It shows just how weak the economy is, that even this late in the recession, we’re still losing so many jobs,” said Jered McDonald, an economist with the employment department.
Nevada has the nation’s third-highest unemployment rate. The Silver State trails only Michigan, with 15 percent joblessness, and Rhode Island, where unemployment is at 12.7 percent. Las Vegas has born the brunt of the state’s hard times.
The city recorded the highest jobless rate of any of Nevada’s statistical areas, and it also ranks among the top five markets of its size nationwide for unemployment. Las Vegas lost 11,900 jobs from June to July, and 60,000 jobs year-over-year in July. The employment department blamed the job cuts on cutbacks in local government, slumping convention business and a sustained drop in construction activity.
Las Vegas also hurts more today because it enjoyed an especially vibrant boom era, said Jeremy Aguero, a principal in local research firm Applied Analysis. The city grew more than most other markets in the 1990s and early 2000s.
But that expansion came largely from unsustainble levels of consumer spending, Aguero noted, and it relied on a high concentration of workers in the volatile construction sector.
Plus, Las Vegas feels the downturn more than other areas of Nevada because it’s less diverse, McDonald said. For example, Reno (12.1 percent unemployed) and Carson City (11.7 percent jobless) house more manufacturers, distribution centers, high-tech companies and professional and business services than Las Vegas has, and mining protects the state’s rural areas from the slump. Unemployment is just 6.7 percent in in Elko County, where high gold prices allow businesses to put the labor force to work.
As high as unemployment is, the broader picture is even bleaker, said Keith Schwer, director of the Center for Business and Economic Research at the University of Nevada-Las Vegas.
The employment department’s published jobless rate doesn’t include discouraged workers who’ve stopped hunting for jobs, and it doesn’t count underemployed Nevadans who’d like to work full-time but can find only part-time jobs.
If you factor in the discouraged and the underemployed, Nevada had a 12-month average of 15.2 percent joblessness in the second quarter. McDonald said he suspects the rate is even higher now — perhaps nearly double the stated unemployment rate, and certainly close to 20 percent.
Aguero sees underemployment written all over the latest figures that gauge hours on the job. The average number of hours worked by all private-sector employees in Nevada was 35.8 hours a week in June. That’s down from 37.5 hours in June 2007. Average weekly earnings also dropped, falling from $739 in June 2008 to $706 a year later.
“This other layer of unemployment is pretty problematic for us,” Aguero said. “It says there’s substantial compression being pushed down on the average worker, and their ability to earn is much lower. But more important than that, there’s a general belief that both hours and wages will have to rebound before unemployment rebounds. These numbers are a greater signal on whether the economy is showing signs of improvement.”
Even the basic statewide unemployment stats show few signs of improvement. Just two of Nevada’s major employment categories grew year-over-year in July. Mining added 100 jobs, for growth of 0.8 percent, while the combined category of health and education services gained 2,200 positions, or 2.3 percent.
Construction lost 32,200 jobs, or 25.7 percent of its work force. Manufacturing employment shrank by 3,800 positions, or 7.8 percent. Leisure and hospitality companies cut 22,700 jobs, or 6.8 percent of their industry’s work force. The banking field was down 4,200 jobs, or 6.8 percent, while professional and business services such as law firms, accounting businesses and engineering companies slashed 10,700 jobs, or 7.1 percent of the sector’s work force. Governments statewide cut 4,400 jobs, or 2.9 percent of their total work force.
There’s also no indication that the labor pool is shrinking from outmigration or any other cause. The state’s work force expanded 2 percent from June to July, growing by 28,000 people to 1.41 million workers. The local labor force grew 2.3 percent, or 23,200 people, to just more than 1 million. A bigger work force could contribute to gains in unemployment, while a smaller work force could curb jobless levels.
How’s that hope and change working out for you SEIU members in NV? All those union dues taken from your paychecks the past couple of years hasn’t paid your rent or light bills.
Do not go to Las Vegas-Barack Obama
Yes, he is.
This was foretold by people (even bankers) in Reno in the mid-90’s. There was a bank called “Comstock Bank” (which was bought up First Security, who was then bought up by Wells Fargo. When they were Comstock, they used to publish a state economic summary every month. It was a very, very good piece of analysis and stats.
Comstock’s analysts worried openly that if the Reno/Sparks are decided to become a “one-industry town” like Vegas, the first recession we hit would thump the heck out of the Reno economy.
Comstock’s analysts were right. Reno, as it turned out, didn’t follow Vegas into the “gambling is our business” model. Still, the diversification of Reno hasn’t shielded them from the recession, because post 2002, ao much of Reno’s economy became construction and real estate.
I don’t understand this. Nevada voted for change and their man was elected. Then he said that there were too many conventions in Las Vegas, and right away there were fewer conventions there! They voted for it and are geting it good and hard! What is the problem?
Impossible! Did the Brothels and Strip Clubs stop hiring? (SARC)
Couldn’t happen to a nicer collection of union thugs, Mafiosi, hookers, grifters, strippers and land sharks. Hope you enjoy the change you voted for, dirtbags.
At this rate, the desert will eventually take back this region...
"Community Bank of Nevada was seized by the state’s Financial Institutions Division today, and was handed over to the Federal Deposit Insurance Corp. as its receiver.
The bank struggled for the past year as the commercial real estate market fell in Las Vegas. The bank was heavy in commercial real estate and construction loans.
Many of its loans were at least 90 days overdue, accounting for $261 million in potential losses. It also had $112.9 million in foreclosed property, as of March 31."
yitbos
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.