State jobless rate jumps; numbers worse in Las Vegas

By Nicole Lucht (contact), In Business reporter

Fri, Mar 13, 2009 (2 a.m.)

January was another grim month for unemployment in Southern Nevada and most of the rest of the state.

Las Vegas’ unemployment rate hit 10 percent in January, while the state’s jobless rate increased a full percentage point to 9.4 percent.

The state adjusted its unemployment calculations for 2008, taking into account new population estimates. An earlier report said Nevada’s jobless rate for December was 9.1 percent; it has been adjusted to 8.4 percent.

Las Vegas’ jobless rate in January 2008 was 5.6 percent, making this January’s rate a year-over-year increase of 78.6 percent.

The disparity between the state’s unemployment rate and Las Vegas’ is because the state doesn’t seasonally adjust metropolitan areas, said Bill Anderson, chief economist for the state’s Employment, Training and Rehabilitation Department.

Typically, there is an increase from December to January as workers at seasonal retail jobs are let go, although Las Vegas had fared better in the past, Anderson said.

But with the overall economy in decline, the unemployment rate increased at a larger than usual rate, he said.

“By Southern Nevada standards, it certainly is (a large increase) but it’s also reflective of the overall economy,” Anderson said. “That’s one thing about this recession: It’s impacting regions that typically haven’t had to deal with this kind of weakness in the labor market. Not only here in Nevada, but in Arizona, the Carolinas, Georgia, Florida. Those are states that typically have held up relatively well over time. But they are at the forefront of this recession.”

CityCenter, scheduled to open later this year, won’t be the savior that many people expect, said local economist John Restrepo, principal of Restrepo Consulting.

“It’s lost its reliability because of the depth of the economy,” he said. “(The recession) is dramatic enough that it can change human behavior for a while. The period of unfettered, conspicuous spending is gone for a while, or it’s going to be limited.”

Both economists don’t expect an economic recovery until late 2010 or early 2011. For Restrepo, that means six months of sustained growth in the housing market and in job growth.

“Until we see those two indicators, all bets are off,” Restrepo said.

Anderson expects the rising jobless rate to peak, although “out-and-out growth” won’t happen for at least 18 months.

However, “there are so many wild cards out there, especially as it pertains to the stimulus package and what impacts that may have on the situation,” Anderson said. “This downturn in the economy has been very difficult to forecast from the get-go, and it remains so.”