Nevada's jobs market outperformed the nation's in May.
That's not a typo. Even as unemployment increased nationally, joblessness in the Silver State fell. The trend surprised economists, who said they expected tougher times here to match national sluggishness.
"When placed against the backdrop of weak reports on the national labor market, I'm fairly encouraged by what we saw in Nevada," said Bill Anderson, chief economist of the state Department of Employment, Training and Rehabilitation. "It wouldn't have surprised me to see a weak report in Nevada, so the fact we were able to show improvement in that (U.S.) environment is a positive."
Nevada still has problems, to be sure. It has ranked No. 1 in unemployment for two years, and part of its May jobless drop came from people quitting the work force. But the state added enough job growth to that dwindling labor pool to pull off something the rest of the nation couldn't: lower unemployment.
Start with the national numbers. U.S. job growth slowed to a crawl in May, with employers creating 69,000 jobs - well below the 100,000 jobs a month needed to keep pace with population growth, according to a recent Brookings Institution study. That rate was down from 225,000 jobs a month in the first quarter. Unemployment rose to 8.2 percent, up from 8.1 percent in April. Nationwide claims for jobless benefits jumped by 6,000 to 386,000 in the week ending June 9.
That's not what happened in Nevada.
May's increase of 5,900 jobs statewide was the second-best month-to-month gain of 2012, the employment department said Friday. Nevada added 9,000 jobs in the first five months of 2012 when compared with the same period in 2011.
The state's jobs count of 1.14 million was at its second-highest level in nearly three years. Unemployment fell to a three-year low of 11.6 percent in May, down from 11.7 percent in April, for nine straight months of declines. Plus, first-time jobless claims fell in May to their lowest level in four years.
In all, 158,300 Nevadans were out of work and looking for jobs in May, down from 183,900 a year ago. About 116,000 Las Vegans lacked jobs but were looking, down from 135,000 in May 2011.
In Las Vegas, unemployment increased to 11.8 percent in May, up from 11.6 percent in April. It was the first gain after eight straight months of decreases. Blame the jump on accounting: The employment department seasonally adjusts jobless rates statewide, but not locally.
Seasonal factors affecting Las Vegas unemployment included high school and college graduates entering the work force, said Steve Brown, director of the Center for Business and Economic Research at the University of Nevada, Las Vegas. He said Nevada outperformed the nation in May partly because it spent winter lagging the U.S. job market.
U.S. job growth from December through February wasn't sustainable, he said. Nevada didn't experience the rapid job growth in the period that would force employers to pull back the way they did nationally in spring.
Plus, it took time for national improvements to filter down to Nevada's job markets, said Brian Gordon, a principal in Las Vegas research firm Applied Analysis.
National unemployment peaked at 10 percent in fall 2009, and has dropped 1.8 percentage points since. It takes a while for such slow improvements to reach Nevada's tourism markets. Unemployment in the Silver State peaked at 14 percent in October 2010 and languished above 12 percent until April. And Nevada still has miles to go, he added.
"Improvements have been extremely modest compared to the gigantic hole we created during this last recession," he said. "It's going to take a significant amount of time to return to a more normalized number."
To understand how significant an amount of time, consider that part of May's jobless drop was from a smaller work force. Nevada's labor pool fell to 1.36 million in May, down 1.6 percent from 1.38 million in May 2011. In Las Vegas, the work force shrank to 984,100, down 0.8 percent from 992,500 a year earlier. People who aren't looking for work aren't counted as jobless, so unemployment can fall when the labor pool shrinks. Include discouraged workers and part-timers who wouldd rather work full-time, and Nevada's jobless rate was 22.3 percent in the first quarter.