Jobless total drops in April; some say bottom nearing

State unemployment data went in two directions in April, with the number of jobless Nevadans dropping even as the percentage of unemployed residents rose.

The uneven performance gave Nevada a one-month break from the bigger unemployment spikes of recent months. But economists at the state's Department of Employment, Training & Rehabilitation say it's too early to call an end to the downturn, and they expect several factors to push statewide unemployment to a high of 11.5 percent by early 2010.

"If you look at both the number of unemployed and the unemployment rate, they suggest the labor market moved sideways in April," said Bill Anderson, chief economist for the employment department. "If we see another month or two of sideways movement in various indicators, that will suggest to us we are approaching the bottom of this downturn. These trends, taken as a whole, could be a first, very tentative sign that the rate of our deterioration may be moderating."

Added Keith Schwer, director of the Center for Business and Economic Research at the University of Nevada, Las Vegas: "Interpreting (new numbers) as a fundamental shift in the economy would probably be premature, because one month doesn't make a trend. But this could be the beginning of the end of this long recession. It's going to take a while to see, but we've had a whole series of month-after-month of declines, so this is welcome news."

The number of unemployed Nevadans fell for the first time in the past year, dropping from 146,400 in March to 146,300 in April.

Still, the proportion of Nevadans without jobs rose statewide, going from 10.3 percent in March to 10.6 percent in April. That April rate was just a tenth of a percentage point below the state record of 10.7 percent, set in December 1983.

Joblessness in Las Vegas stabilized from March to April, staying at 10.4 percent. Unemployment in both Las Vegas and across the state is nearly double April 2008's levels.

Local economists said the number of unemployed might have declined as the percentage of jobless people increased because of seasonal adjustments in data, or because people quit looking for employment and dropped out of work-force tabulations.

Employers also created fewer jobs, Anderson said. Companies reported 5,200 fewer positions statewide in April than they reported in March. That's down from an increase of 5,100 positions in the same period a year ago, and it's well below the five-year average of 11,320 new positions from March to April.

The U.S. Labor Department said Friday that 44 states lost jobs month-over-month in April. California saw the steepest decline, with 63,700 positions lost. Employers in Texas dropped 39,500 jobs, while Michigan's businesses reduced payrolls by 38,400 positions. Ohio's job market shrank by 25,300 posts.

States with job growth in the period include Arkansas, Florida and Montana, which all enjoyed gains of 1,300 to 1,500 jobs.

Since the recession began in December 2007, the United States has lost 5.7 million jobs. National unemployment stands at 8.9 percent, a quarter-century high.

In Nevada, industries that lost the most jobs month-to-month include retail, which cut 1,600 jobs; professional and business services, which slashed 1,400 positions; local governments, which pared 1,500 posts; and construction, which shed 1,200 jobs.

The state's dominant sector, gaming resorts, ended a string of monthly losses, staying flat from March to April. Food service and drinking establishments added 1,100 jobs and education and health services added 100 jobs. Year-over-year in April, Nevada's employers dropped about 55,000 jobs, with 22,600 of those jobs in construction.

That's the "sharpest (annual) decline" in unemployment in the last two decades, noted Brian Gordon, a principal in Applied Analysis, a local business advisory firm.

In the first four months of 2009 alone, Nevada jettisoned 5.7 percent of its job base. Those losses makes the recession of the early 1980s, when state unemployment last hit records, look tame: Throughout 1982, Nevada dumped 2.4 percent of its jobs, Anderson said.

Economists said conditions set the stage for additional job losses through 2009.

First, construction unemployment could increase sharply once developers finish building major projects such as CityCenter. No substantial resorts are planned along the Strip after the current wave of construction ends, so the 8,500 workers building CityCenter will have a tough time replacing their jobs, Anderson said.

What's more, vacancies inside office buildings, industrial parks and retail centers have risen sharply, so construction of commercial space will likely retreat in coming months, Gordon said.

And as the Detroit Three American automakers restructure in coming months, local car dealerships will close, potentially putting hundreds more out of work. Dealers of new cars already junked more than 550 jobs in Nevada through the third quarter of 2008, the latest period with available statistics. Chrysler said May 14 that it would cancel sales agreements with four local dealers, though General Motors hasn't said it would pull area franchises. Dealer closings could "significantly increase" job losses later in the year, Anderson said.

Just how much unemployment increases will depend on a handful of other factors.

If unemployed construction workers leave the state to look for work elsewhere, the labor force here will shrink, and the unemployment rate could, Schwer said.

Plus, federal stimulus spending could boost construction employment if some of that cash makes its way into local projects, Schwer said.

The 10,000 to 12,000 jobs CityCenter creates could offset job cuts from the project's completion. But with 16,600 jobs lost in hospitality locally in the past year, CityCenter may create only "incremental growth" in the overall job market, Gordon said.

Senate Majority Leader Harry Reid, D-Nev., said in a statement that the state's economy has shown signs of life, with casino executives pointing to recent increases in hotel occupancy and improvements in convention bookings. He also noted that corporations, including IBM and Southwest Airlines, have brought thousands of workers to Las Vegas for employee appreciation events and business meetings.

Contact reporter Jennifer Robison at jrobison@reviewjournal.com or 702-380-4512. The Associated Press contributed to this report.