Nevada, Las Vegas jobless numbers drop

Local and state labor markets ended 2012 with a bang, as jobless figures took an unexpected plunge toward single digits in December.

The improvements came mostly from job growth and surprised economists who had predicted a longer slog toward significantly lower jobless rates.

Unemployment in Las Vegas dropped to 10 percent in the month, down from 10.4 percent in November and
13.3 percent in December 2011, the state Department of Employment, Training and Rehabilitation said Friday.

Unemployment in Las Vegas was more than 11 percent as recently as October.

The statewide rate dropped to
10.2 percent, compared with 10.8 percent in November and 13 percent in December 2011.

December's rates were the lowest since mid-2009. The big drops came on top of a November dip of 0.7 percentage points statewide and locally, and Las Vegas' gain came despite an influx of 3,100 new workers entering the labor pool from November to December. That means Southern Nevada created more than enough jobs to absorb the increase in workers.

Experts said it's too early to predict more strong job growth in the months to come, but they added that Friday's report hinted at a revitalizing market.

"We need to be cautious about reading too much into the latest report card, but it appears employers have opted to reinvest in their human capital and bring on additional workers to meet the demands of their business," said Brian Gordon, a principal in local research firm Applied Analysis. "There may be some recession fatigue setting in as they've held off on new hires. In material numbers, they've been holding off for so long, and December may have been the first month in which they started to really ratchet up (hiring) activity."

It was supposed to take longer to reach the threshold of single-digit unemployment. The department said in a November forecast that it would be late 2013 or early 2014 before joblessness here fell below 10 percent.

"The fact that we closed out 2012 with four consecutive monthly declines, and the fact that job growth in December relative to a year ago was the strongest in all of 2012, those things should give us some confidence moving forward," said Bill Anderson, chief economist of the employment department.

Added Steve Brown, director of the Center of Business and Economic Research at UNLV: "This is a favorable report and an unexpectedly strong report. I think we may move into single digits sooner than we expected."

December's report, which came from surveys of households and businesses, and figures on first-time unemployment claims, showed job growth across the board. Nevada had 18,700 more jobs in December than it had a year ago, and the November-to-December gain of 2,000 jobs was the best monthly improvement of 2012.

The number of retail jobs jumped
3.5 percent year over year, and the sector's September-to-December job growth of 9,100 positions closely matched pre-recession averages, Anderson said. Leisure and hospitality also added 1.9 percent to its workforce. Education and health services jobs spiked 5.8 percent. There was even stability in construction, which ended 2012 with two straight months of seasonally adjusted job gains, and government, which had 1,600 more jobs at the end of 2012 than it had in late 2011.

And though Nevada ranked last in the nation for job growth during the recession, its 1.7 percent increase in December was better than gains in 17 other states, Anderson said.

For 2012, Nevada's unemployment rate averaged 11.6 percent, down nearly 2 percentage points from 2011. In all, 138,300 Nevadans were unemployed and looking for a job in December, down from 179,700 a year ago. Las Vegas had 97,000 unemployed job seekers, compared with 131,200 in December 2011. It was the first time in four years that the local market had fewer than 100,000 unemployed workers, Gordon said.

Still, Las Vegas and Nevada have far to go in rebounding from the recession.

"If you go to the hospital, they don't send you home until you've finished recovering, and we're still in the hospital," Brown said.

Nevada added 31,100 jobs from December 2010 to December 2012, but that is just 17.8 percent of the 175,000 jobs - about 100,000 of them in construction - that the state lost in the downturn.

Brown said Nevada could regain all of its lost jobs, though it could take at least two to three years, and the composition may look different. The state's employment base probably will have fewer construction jobs and perhaps more high-tech positions.

For another bleak indicator, consider discouraged workers who left the labor force and underemployed part-timers who would rather work full-time. Include them, and the state's jobless rate is still more than 21 percent.

Plus, December's, and 2012's, numbers will be revised in March, and those changes could paint a different jobs picture. That happened in 2011, when revisions showed higher labor force participation than expected, and the jobless rate was adjusted to 13.5 percent, up from earlier estimates of 13 percent.

Nor has Anderson changed the employment department's longer-term forecast for job gains, which should stay at around 2 percent year over year, down from roughly 6 percent before the downturn.

And as labor markets improve, more Nevadans may re-enter the workforce to seek jobs, and that could push up the jobless rate, Brown said.

State and local rates remained well above national unemployment, which was 7.8 percent in December. Nevada has led the nation in unemployment since May 2010, though it had company in December, when Rhode Island caught up to tie the Silver State at No. 1.

California ranked No. 2, at 9.8 percent.

Contact reporter Jennifer Robison at jrobison@reviewjournal.com or 702-380-4512. Follow @J_Robison1 on Twitter.