Leading indicators


Nevada's unemployment rate dropped last month, while state sales tax receipts showed a healthy jump in January. Are we turning the corner?

No doubt the state has seen a modicum of economic improvement in recent months. Tourist traffic has been relatively strong and foreclosure numbers have dropped somewhat.

But this week's news on unemployment and sales tax collections comes with a few modest caveats.

The jobless rate fell to 12.3 percent in February, down from 12.7 percent a month earlier. Good news.

The drop, however, can be attributed to the fact that a number of discouraged workers stopped perusing the help-wanted ads. According to the Nevada Department of Employment, Training and Rehabilitation, about 6,500 unemployed workers dropped out of the labor force last month.

As for the sales tax numbers, the Nevada Department of Taxation reported that collections rose 6 percent in January when compared with the same month in 2011. That's the 19th straight month of gains. Once again, encouraging news.

It's important to remember, though, that officials are measuring recent sales tax figures against numbers compiled during one of the worst recessions in state history.

Nevada's construction industry -- which, in large part, drove the state's boom -- continues to struggle.

The danger is that government and elected officials will use any bit of good news to justify abandoning the fiscally prudent reforms that have helped mitigate the economic damage.

"The latest decline in our unemployment rate indicates our economic indicators are headed in the right direction," said Gov. Brian Sandoval. "But this month's figures are also a reminder that we must continue to strive for job growth in every sector in this fragile economic recovery."

Very true.

 

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