Earlier this month, the Nevada Department of Employment, Training and Rehabilitation issued a press release reporting that initial unemployment insurance claims fell to a record low of 11,950 in December. Initial claims data represent the number of people filing for employment benefits for the first time—a general indicator of how the economy is performing. The previous low, 12,000, was recorded roughly 25 years ago (1993). Worth noting is that Nevada has twice as many employees today as it did in 1993, meaning the initial claims rate is effectively half of what it was when the previous record was set.
Perhaps more important than the previous low is previous peak in initial claims. That came in December 2008, when 36,400 Nevadans applied for unemployment benefits in a single month. All told, Nevada lost 180,000 jobs between December 2007 and September 2010, 1 in every 7. In the private sector it was 1 in every 6 jobs; and, in the construction sector, it was a staggering 2 in every 3 jobs. To be clear, more than 96,000 construction workers were displaced between the peak reported in June 2006 (146,400 jobs) and the trough reported in March 2012 (50,100). That number of displaced workers is more than the total number of construction workers employed today, statewide.
Nevada now leads the nation in job creation. The latest United States Bureau of Labor Statistics reports place Nevada’s employment growth rate at 3.8 percent, more than double the national average. Nevada added nearly 52,000 jobs during the past 12 months, the fastest pace of job creation in more than a decade. Nearly every sector of the state’s economy is reporting gains, with particularly strong increases noted in business and professional services (+13,400 jobs), construction (+9,900 jobs), leisure and hospitality (+8,000 jobs) and manufacturing (+7,000 jobs).
There is no version of these statistics that is not encouraging. Nevada is approaching full employment, diversity measures are decidedly improved, 100,000 jobs have been added in small businesses, nearly 80 percent of new job creation is in full-time positions, and wage and salary growth is stronger than anticipated. The next challenge will be economic sustainability. Economic development s t r a t e g i e s d e p l o y e d w h e n t h e unemployment rate was 14.1 percent (September 2010) are not necessarily fitting when the unemployment rate is 4.4 percent (November 2018). There are more than 485,000 students in Nevada’s K-12 public schools, many of whom will need to be employed in jobs that don’t even exist today. Gen Z consumers, who will overtake Millennials in 2019 as the largest population cohort, have distinctive perceptions of value and experiential expectations, including those surrounding travel and entertainment, the major drivers of Nevada’s economy. As hard as getting people back to work has been over the past decade, keeping them working may very well prove the greater challenge. To this end, the economic development policies we choose to put in place during this period of relative prosperity will be significantly more consequential than those we will deploy in response to the next economic downturn.