CARSON CITY -- Nevada's unemployment jumped again in September, hitting 7.3 percent for the highest jobless rate in nearly 23 years, a state agency reported Monday.
The state's seasonally adjusted rate was up two-tenths of a percentage point from August and up 2.3 percentage points from September 2007.
The last time the unemployment rate was this high was in November 1985, according to the report from the Nevada Department of Employment, Training and Rehabilitation.
Rates in the state's two metropolitan areas increased as well, led by Las Vegas at 7.4 percent, up from 5.1 percent for the same month in 2007, followed by Reno-Sparks at 6.9 percent, up from 4.5 percent.
The number of people filing for unemployment is the highest it's been since October 2001, the month following the Sept. 11 terrorist attacks in New York and Washington, D.C. In September, initial claims for unemployment topped 21,000. Final payments for unemployment insurance rose to an all-time high, increasing to 4,710 in September, surpassing the previous high of 4,565 set in April 2002.
"Nevada continues to feel the economic pinch that the rest of the nation is experiencing," said Bill Anderson, chief economist for the agency. "What was a lingering problem for consumers and commercial developers quickly became a full-scale emergency as credit for doing daily business dried up.
"The bailout should free up credit, allowing commercial development to continue," he said, referring to the $700 billion economic stimulus bill approved by Congress and signed by President Bush earlier this month. Additionally the bailout may help the residential housing industry nationwide and in Nevada.
"We are all holding our breath waiting to see how much of a lifeline the bailout will provide. However, it will be months before it will reflect in the unemployment rate. There simply is no quick fix," he said.
While Nevada's rate climbed in September, the national rate held steady at 6.1 percent.
Anderson said this can be attributed in part to a larger number of people dropping out of the work force. About 121,000 people nationally have stopped actively seeking employment, which means they would not be counted in calculating the unemployment rate, he said. Statewide figures are not available.
In Nevada, school employees returning to work accounted for a slight increase in job growth for the month of September. But job growth is down overall by 0.6 percent over the year, which equates to the loss of 7,600 jobs, Anderson said.
Current projections suggest Nevada's unemployment rate will average about 8.6 percent for 2009, reaching 8.7 percent by the end of the third quarter. This equates to about 120,000 people out of work, Anderson said. This is despite the federal bailout bill, which hopefully will help relieve the current national economic crisis, he said.
Because of the rising unemployment rate, the federal government awarded funds for each state to extend unemployment benefit payments to recipients. Another proposal also is being considered to make an additional extension. No decision has been made whether that will happen.
Despite the increase in claims, the state's unemployment insurance trust fund remains healthy enough to continue paying unemployment benefits to workers who qualify, said Anderson, who noted that some states have begun running out of funds to pay unemployment benefits.
Nevada does not foresee such a problem, as the unemployment insurance fund is managed in a counter cyclical manner, meaning the fund builds in times of prosperity and declines when the economy is down.
Contact Capital Bureau reporter Sean Whaley at firstname.lastname@example.org or 775-687-3900.