Nevada’s seasonally adjusted unemployment rate jumped three-tenths of a percentage point to 14 percent in May. The increase not only sets a new all-time high for the State, it also means Nevada now carries the notable distinction of having the highest unemployment rate in the nation. Nevada surpassed Michigan, whose rate fell from 14 to 13.6 percent, in May. Michigan’s manufacturing based economy has been in decline for years, leaving the Wolverine state with the highest unemployment rate for 50 consecutive months – until now. In just three years, Nevada’s economy has fallen from one of the strongest performing to possibly the weakest. Since the start of the recession, in December 2007, the unemployment rate has increased 8.8 percentage points, the largest increase of any state in the nation. In May, Nevada’s unemployment rate was 4.3 percentage points higher than the national average.

Nevada’s employers added 4,800 jobs in May, but most of the increase was seasonal or temporary census hiring. The seasonal increase is an improvement over last year, when employers cut payrolls by 2,400 from April to May. Over the long term though, the increase is less than the 20 year average April to May increase of 7,600. On a positive note, over-the-year employment decline has moderated considerably. In May 2009, employment estimates were down 10.2 percent from the previous year. This May, over-the-year job loss is down just 2.8 percent.

All regional labor markets benefited from a seasonal increase and the addition of temporary census workers. Las Vegas-Paradise area employers added 3,000 jobs in May. While, employers in the Reno-Sparks area increased payrolls by 1,200, and Carson City employers added 100 jobs.

May’s job report brought a mixed bag of seasonal improvement and an unexpected decline in one industry. In preparation for seasonal tourism, employers in the leisure and hospitality sector added 1,300 jobs. Preliminary signs of a much anticipated up-tick in construction employment seem to be materializing with the addition of 500 new jobs. In a somewhat alarming reversal of recent trends, the education and health services sector lost 1,500 jobs. Most of the losses came from training providers in vocational and technical schools and small private practice medical and dental offices. In the public sector, state and local governments continue to shed jobs. New fiscal year budgets start July 1, and due to large budget shortfalls, public sector employment will continue to contract in the near future as previously announced layoffs go into effect. The federal government,

via the census, provided the lion’s share of this month’s employment increase, however these temporary positions are expected to end within months.

Unemployment in each region of the State declined in May, due to seasonal improvements. In the Las Vegas-Paradise area, the unemployment rate decreased from 14.2 to 14.1 percent. The unemployment rate in the Reno-Sparks region fell two-tenths to 13.3 percent. In Carson City, the unemployment rate fell to 13.2 percent from 13.5 percent the previous month. (Unemployment rates for the State’s metropolitan areas are not adjusted for seasonality. For comparison purposes, the State’s unadjusted unemployment rate was 13.8 percent in May, down from 14.0 percent in April.)

Nevada has been hit extremely hard as the recession has spread throughout the economy. In fact, the State’s jobless rate has increased to the point that it is the highest in the nation. During the early-2000s, Nevada’s unemployment rate was fairly similar to Michigan’s. However, by the middle part of the decade, the Silver State’s jobless rate was 2.6 percentage points below Michigan’s. In the last year, conditions have deteriorated markedly in Nevada, while Michigan has seen some improvement. In May 2009, Michigan’s unemployment rate was at a seasonally adjusted 13.6 percent, 2.1 points higher than Nevada’s. However, as of May 2010, Nevada’s rate has jumped 2.5 percentage points, while Michigan’s has begun to subside, falling from a peak of 14.5 percent in December to 13.6 percent. Clearly, with its historical reliance on gaming and construction as engines of growth, Nevada has been at the epicenter of the current economic downturn, as these two sectors have each felt the brunt of negative economic forces.

There are a number of factors contributing to the run-up in the State’s unemployment rate. However, looking at it in as straight-forward manner as possible, a couple of trends stand out. As the State’s employment base continues to erode, upward pressure is placed on joblessness. Household employment, which differs from the employer-based measure of employment which is typically the focus of our monthly analyses, has declined by more than five percent since the beginning of 2007 (Household employment is based on a survey households, while non-farm, or industrial employment is based on a survey of employers.) By itself, this accounts for some of the increase in joblessness. At the same time, the State’s labor force has continued to expand as the recession has unfolded, and more Nevadans have entered the job market looking for work. Specifically, the labor force has expanded by 5.5 percent since January 2007. In essence, there are more Nevadans in a labor market with fewer jobs.

Nevada’s mining region, centered in Elko County has fared relatively well compared to the rest of the State in the recession. High gold prices and resurgence in commodity prices has brought stability to the region’s mining-based economy. Gold recently sold at an all time high of $1,246 per ounce, and copper prices have rebounded despite the deep recession. Demand for copper from emerging economies such as China and India have pushed copper prices to near pre-recession levels at over $3 per pound. Though there has been some spillover from the downturn in the broader economy, the recession’s affect on the mining region has been comparatively mild. For instance, Elko County’s unemployment reading in May is 5.5 percentage points lower than the Statewide average, 13.8 percent (not-seasonally adjusted.) Taxable sales figures, a gauge of economic activity and consumer sentiment have held up pretty well in Elko compared to the rest of the State. In calendar year 2009, taxable sales were down just five percent over-the-year, while Statewide taxable sales were down 17 percent. Employment has held up well, too. From the start of the recession through September 2009 (the most recent figure available), employment fell by just 620 jobs, a three percent decline, compared to a Statewide drop of 159,900 or 14 percent over the same time frame. While things look positive now for Nevada’s miners, it’s important to note that gold prices tend to run counter cyclical to the business cycle and have seen many ups and downs in the past. With a national economic recovery likely, gold prices are bound to decline in the years ahead.

Chief Executive Magazine released its list of the Best and Worst States for Business.  Nevada was ranked number 5.  California was ranked the worst.

Nevada surely offers a great tax climate for businesses.  But when you talk to the economic developers of the state, we have some challenges attracting quality businesses due to the lack of infrastructure such as health care and education.  I encourage Nevada to take a position while we are young enough, and do not have the heavy regulation in place, to focus on correcting these two industries (Eds & Meds).  Pittsburgh, PA did this back in the 1970s and their economy is in the best shape it has been in since the good old’ Steel days.

Below is a chart that of the results provided by the 651 CEOs who took the survey:

University of Nevada Reno, Orvis School of Nursing, has reached capacity again and is looking to double their enrollment.  When this is completed, it is expected that the new UNR facility will ease the nursing shortfall.  Northern Nevada is not unique in this capacity problem.  Southern Nevada faces the same issue.  And pretty much every nursing program in the State of Nevada is at capacity as we lack sufficient clinical space.

“Growing our own” is surely the best route to go for Nevada.  We have lacked in our production of registered nurses over the year.  To put some perspective to this….back in the late 1990s when we first started focusing on the nursing shortage, Nevada was graduating some 332 registered nurses each year.  The problem was we needed over 800 to fulfill our needs.  So we had to go out-of-market to attract nurses to relocate.  This is how Recruiting Nevada came about.

However, we knew that we needed to increase Nevada’s home-grown supply of registered nurses.  So we lobbied the Nevada Legislature to double the nursing program.  That happened 3 sessions later and between the public nursing schools and the privates, Nevada now graduates around 1,000 registered nurses each year.

We are well on our way to a sustainable recruiting solution for registered nurses in Nevada.  There still are some changes that need to happen in clinical scheduling to increase (and optimize) overall capacity.  Several groups are working on that problem as we speak.  Kudos to UNR for their expected growth and contribution to the overall wealth and health of Nevada.

Nevada has the potential to lead the nation in renewable energy exploration and exploitation.  We know more renewables exist in Nevada than most states. We just need to leverage them.  But before that happens, we need to understand renewable energy and become leading experts.  That requires a deeper level of education and more degrees than we currently offer.

Until now…UNR in partnership with the National Science Foundation is offering scholarships to provide financial, academic and professional development support for up to 20 incoming freshman to study renewable energy.  The total of the grant is $600,000 which is a step forward.

“Energy, and specifically renewable energy, has become increasingly important to Nevada’s economy,” Manos Maragakis, dean of the College of Engineering, said. “This grant will allow us to build on our strong renewable energy program, our dozens of renewable energy research projects and will provide qualified graduates to the energy industry in Nevada.”

This is good news for Nevada.  Kudos to the entire team for pursuing this funding stream.

The Nevada Development Authority and Las Vegas Visitors and Convention Authority have partnered in an attempt to attract companies to relocate to Las Vegas and diversity Nevada’s economy. Read the article in the Las Vegas Sun.   This is a fabulous idea.  Actually one that we floated around to the NDA over a decade ago during the Dot Com boom when diversification efforts were in full force.  Why not stick a “Welcome to Fabulous Las Vegas….Why not stay here” sign in front of 2 million decision makers each year?  This makes absolute sense.

Back in the late 1990s when we were building TBAN (Technology Business Alliance of Nevada) and promoting the weekly Tech Tuesdays event, we discovered a major problem in diversifying the Las Vegas economy into technology.  The problem is the same problem that exists for nearly every professional industry today….”which comes first, the company or the professional worker? ”  We had started a conversation with Manny Cortez, past CEO of the LVCVA about a permanent kiosk that would have computer screens on each side.  For most conventions, one side would be dedicated to recruiting companies.  For other industries, such as health care, we would change the kiosk screens to focus 100% on attracting the much needed talent.  And if we were trying to attract an entire industry, such as Bio Tech, all screens would focus on company recruitment.

This concept is sound. Many business travelers are not aware of the great climate we have to offer here in Nevada.  Now they will.  To accelerate diversification, I encourage our economic developers to focus on Eds & Meds.  If we focus on these two industries, others will follow.  This model worked for Pittsburgh, PA.  And it will work for Las Vegas.   Again – many congrats, and thanks, go to Somer Hollingsworth and Rossi Ralenkotter.

For those industries (or industry…..health care) that have jobs that require out of market recruiting…..Las Vegas is an affordable market to buy again.  According to Trulia, Las Vegas ranks No. 10 on its list of cities where it is cheaper to buy rather than rent.  Las Vegas ranked at a 10.92 price-to-rent ratio.  If you are not certain what this metric means, here is a definition:

Price-to-Rent Ratio of 1-15: It is much less expensive to own than to rent a home in this city Price-to-Rent Ratio of 16-20: It is more expensive to own a home in this city are The total costs of ownership of a home in this city are greater than the costs of renting, but it might still make financial sense depending on the situation. Price-to-Rent Ratio of 21+: The total costs of owning a home in this city are much greater than the costs of renting.

If you are into economic charting, check this out.  It details the current marketplace for Las Vegas home listings.

This is good news.  We used to use Las Vegas’ housing affordability as an attraction tool back in the 1990’s and early 2000’s when it was affordable.  It became more challenging during the real estate boom when houses were selling within hours of being listed and the banks were lending to anyone who asked.

See….maybe there is a silver lining in this whole situation.

The SHRM LINE^® Employment Expectations Report for June 2010 was recently released.  Nationally, things are starting to look up a little.  But, just a little.  Here are some of the key findings:

• Hiring rate is at or near 50 percent in both sectors in June
• Top-level talent is not elusive, but harder to secure in May
• New-hire compensation improves for fourth straight month in May

This is the strongest start for Summer hiring in three years.  Yes – I am trying to remain optimistic.  However, I still believe we will see flat, or increased, unemployment levels in Nevada for months to come.  For the first time, we will be the last to recover from an economic slow down.  Here is a link to the full report.  Here is a graph/chart for those who do not like to read full reports:

I love dashboards more than most.  Something that is simple to read and provides a quick glance as to what is going on.  Check out the dashboard below that the Brookings Institute released for Nevada:

If you are interested in reading the commentary behind this dashboard, read the state of the union according to the Brookings Institute (published in the Las Vegas Sun).

Experts say nurses are leading a trend toward more organized labor in the medical setting — mostly in hospitals.

A recently published article in American Medical News discusses the increased number of unions in hospitals. According to the Bureau of Labor Statistics, the number of medical personnel covered by some form of collective bargaining agreement or registered as union members is edging up. This is partly because the health care sector now employs many more people than do traditionally unionized industries such as manufacturing.

Original article

Online job ads for health care practitioners and technicians grew by 3,300 listing in April for a total of 630,000 listings, a level of demand not seen since the recession began two years ago, the Conference Board reports.

The report, which tracks more than 1,000 online job boards across the United States, also notes that the demand for health care support occupations has remained relatively strong throughout the recession and grew by 2,400 listings in April, to 128,700 listings, the highest monthly level since the HWOL series began in May 2005. Increases in this field reflect the continued strong demand for workers in occupations like occupational and physical therapists and nursing aids, the report said.

Demand in the health care labor market varies substantially from the higher-paying practitioner and technical jobs to the lower-paying support occupations. In April, advertised vacancies for health care practitioners or technical occupations outnumbered the unemployed looking for work in this field by 4 to 1, and the average wage in these occupations is $32.64/hour, the report said. The average wage for health care support occupations is $12.66/hour and there were more than two unemployed people looking for work in the field for every advertised vacancy, the report said.

Original article by John Commins, for HealthLeaders Media.