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What’s New in the LMI World—Nevada’s Perspective

What’s New in the LMI World—Nevada’s Perspective. Department of Employment, Training & Rehabilitation Frank R. Woodbeck, Director Bill Anderson, Chief Economist Prepared by the Research and Analysis Bureau for the Second Annual EMSI Conference—September 2012.

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What’s New in the LMI World—Nevada’s Perspective

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  1. What’s New in the LMI World—Nevada’s Perspective Department of Employment, Training & Rehabilitation Frank R. Woodbeck, Director Bill Anderson, Chief Economist Prepared by the Research and Analysis Bureau for the Second Annual EMSI Conference—September 2012

  2. Nevada’s Recession Scorecard: Unemployment Rate • Despite the fact that it has come down from all-time highs, Nevada’s jobless rate is 6.8 percentage points higher than at the “official” start of the recession in December 2007. • The U.S. unemployment rate stands 3.3 points higher than at the start of the recession.

  3. Unemployment Rate Rankings (SA) • In July, Nevada maintained the highest unemployment rate in the nation. • Rhode Island was second-highest, at 10.8%. • North Dakota’s three percent jobless rate was the lowest.

  4. Nevada’s Recession Scorecard: Non-Farm Jobs (SA) • Nevada’s job losses since the “official” start of the recession in December 2007 total 158K (-12.2%). • Over the same period, U.S. jobs are down 3.4%. • 400K jobs were created in Nevada between 1997 and 2007.

  5. Number of States with Higher Rates of Job Growth than Nevada (year-over-year; 2012 data are for June) • As of June, just 19 states had a higher job growth rate than NV. • Over the 2003-2005 period, NV had the highest growth in the nation. • At the height of the recession, every other state had a higher rate of job growth than NV.

  6. In Nevada, We Need Information & Intelligence, Not Just Data

  7. Las Vegas Strip Casino Revenue: Gaming vs. Nongaming (share of total revenue; by fiscal year) • The traditional “gaming” industry in Nevada has diversified. • In FY 2011, 62% of Las Vegas Strip casino revenue was from nongaming sources (rooms, food/beverage, etc.), and that share has been consistently on the rise. • Gaming revenue accounts for just 38% of the total, down significantly from a 59% share in FY 1989.

  8. Current Population Survey Results

  9. Alternative Measures of Labor Underutilization (four quarters ending 2012:IIQ) • U-3 similar in scope to the official rate. • U-4 includes discouraged workers. • U-6 includes all persons available for work whom are only marginally attached to the labor force plus involuntary part-time workers.

  10. NV Labor Force Participation Rate (labor force / population; 12-month moving average) • Nevada’s labor force participation rate has been trending down in recent years, although there has been considerable volatility. • In late-2008, the LFPR peaked at nearly 70%. In the 12 months ending in May, 65.1% of the population was in the labor force (either employed or unemployed).

  11. Discouraged Workers in Nevada (12-month moving average) • The number of discouraged workers skyrocketed during the recession…an eight-fold increase. • While the increase appears to be easing, there are still 16K discouraged workers in the State.

  12. Unemployment Duration in Nevada (12-month average) • Roughly half of unemployed Nevadans half been without work for more than 26 weeks. • This has the potential for long-term implications.

  13. Information From Unemployment Insurance Programs

  14. Initial Claims for Unemployment Insurance • Initial claims totaled 18,700 in July, barely up from a year ago. • This represents the first increase in more than 2.5 years. • Claims activity during the first week in August was down 12.8% from a year ago, suggesting that July’s results are likely not the start of a trend. • Claims activity during the recession peaked in excess of 36,000.

  15. Total Unemployment Insurance Claims vs. the Total Number of Unemployed • There were approximately 65,600 Nevadans submitting UI claims in July. • 34,700 were regular UI claims; 30,900 fell under a variety of extension programs. • Of the 172,000 Nevadans estimated to be unemployed in July, 38%, were receiving benefits. In the first half of 2008, 46% of those counted as unemployed received benefits. At its peak, the “coverage ratio” exceeded 70%.

  16. Unemployment Insurance Benefit “Coverage Ratio” (share of unemployed receiving benefits) • After peaking at over 70% in early 2009, the UI coverage ratio (45.5%) is nearly back to its average 2007 level (41.3%). • Extended UI benefits provide more than half of this coverage, as regular benefits cover just 21.6% of unemployed Nevadans. • The fall in regular benefit coverage is explained in part by the presence of extended benefits and in part by long-term unemployment, which has reduced the number of people eligible for new UI claims.

  17. Business Employment Dynamics Insights

  18. Nevada Labor Market Dynamics: Gross Job Gains and Losses (SA) • Typically, our monthly analyses focus on net job growth or loss. Beneath the surface, there is considerable activity taking place. • During the recession, gross job gains at expanding or opening private sector establishments tumbled noticeably, while gross job losses at closing or contracting establishments spiked. • As the State’s labor market improved, albeit haltingly, gross gains have stabilized, while gross losses are easing down. • In last year’s fourth quarter (the most recent data available), gross job gains were about 57,500 and losses were about 55,200.

  19. Local Employment Dynamics Information

  20. Employment: 14-18 Year Olds • Employment trends suggest Nevada teens were hit very hard by the recession. • Employment levels (based upon official wage records) have essentially been cut in half…from a pre-recession peak of more than 46K to just above 20K.

  21. Employment by Industry: 14-18 Year Olds(four quarters ending 2011:IIQ) • Just five industries account of more than three-fourths of teen employment in Nevada. • Two industries—accommodation/food services and retail trade—account for nearly two-thirds of teen employment.

  22. Nevada Average Monthly Earnings: All Workers vs. New Hires • In examining wages and earnings, the focus is often on some measure of average earnings. • It is important to note that wages for new hires tend to be below the average. • Specifically, new hire earnings (measured on a monthly basis) tend to be about two-thirds of the overall average.

  23. Last, But Not Least, We have the Labor Market Intelligence Provided via EMSI • To date, EMSI resources have been used to support and inform the State’s new focus on economic development.

  24. 2008 - 2018 Job Growth by Training Level • Over the next several years, jobs with higher-level training requirements are expected to grow the fastest. • Jobs requiring a two-year associate’s degree are projected to show the most growth in percentage terms. • The largest number of available job openings will continue to be found in occupations requiring on-the-job training (about 4,800 per year).

  25. Nevada’s Changing Economic Structure via “Location Quotients” • A measure of relative importance. NV job share/national job share. LQ>1 implies greater concentration in NV. LQ<1 implies less concentration in NV. • Notable trends: • accommodation/food services three times more important in NV than in U.S. (but declining) • construction has been hit hard; LQ much closer to one • health care is growing, but job share is still only about two-thirds of the national average • public sector employment in NV only about 80% of U.S. average

  26. Top-Ten High Growth, High Concentration, High Wage Industries (2006-2011) • Despite the impacts of the recession, there have been some Nevada success stories. • While overall job levels trended down, several showed growth over the past half-decade. • In total, the top-ten high job growth, high concentration (a greater share of NV employment is in these industries than in the nation), high wage industries added more than 10,500 jobs between 2006 and 2011.

  27. Ten Nevada Industries with the Largest 2010-2011 "Competitive Job Shares" • Shift-Share analyses identify that share of industry job growth in a region that is likely due to national trends (expected change), including trends specific to that industry, and region-specific trends (competitive share). • Temporary help services had the largest competitive share in Nevada last year. In all, this industry added 1,800 jobs last year—1,200 were expected given broader trends at the national level and 600 (the competitive share) were due to trends specific to Nevada. • All told, the ten industries in Nevada with the largest competitive shares grew 7.2%, nearly three times faster than their national growth rate—2.5%. • Several of the industries with the smallest competitive shares were those impacted most by the recession—commercial building, commercial banking, local government, electrical contractors, etc.

  28. 2007-2011 Health and Medical Services Sector Employment Growth: Ten Fastest Growing Industries • The HMS Sector weathered the recent recession better than others. • All told, approximately 8,200 jobs were added between 2007 and 2011. • Of the 41 detailed industries within the sector, all but 13 grew over the period. Of the decliners, only one, medical laboratories, had a significant loss (-400 jobs).

  29. 2001-2011 Tourism/Gaming/Entertainment Employment Growth by Sub-Sector • Within the broadly-defined Nevada TGE sector, most sub-sectors have added jobs. In some cases, gains have been considerable. • Food/drinking establishments have added 34K jobs in the past decade. The retail trade and non-casino lodging sub-sectors each added about 7K employees to payroll. • The most notable drop came in the gaming sub-sector, where 26K positions were cut.

  30. For Additional Information, Please Contact: Nevada Department of Employment, Training and Rehabilitation Research and Analysis Bureau Bill Anderson Chief Economist wdanderson@nvdetr.org (775) 684-0450 http://www.nevadaworkforce.com follow us on Twitter @nvlabormarket

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