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Latest federal report on ‘actual’ jobless rate shows employment continues to lag in Nevada


By Sean Whaley, Nevada News Bureau: Nevada’s unemployment picture may be improving, even seeing some job growth in March, but a federal report measuring a broader spectrum of the state’s workforce continues to paint a much grimmer picture for those seeking work.

The report through March 2011 using a four-quarter moving average shows Nevada’s unemployment rate at 23.7 percent, highest in the nation. California is second at 22 percent. The national average is 16.5 percent. The report was released Friday.

The quarterly report from the U.S. Bureau of Labor Statistics includes a state-by-state unemployment measure that encompasses discouraged workers and those who are working part time even though they would like full-time employment.

In contrast, the March unemployment rate in Nevada reported by the state Department of Employment, Training and Rehabilitation (DETR) was 13.2 percent, down from 13.6 percent in February. This official rate does not include discouraged and part-time workers.

Both numbers are estimates only.

The labor statistics report shows that Nevada’s broader unemployment rate actually worsened through the first quarter of 2011, up one-tenth of a percentage point from 23.6 percent in calendar year 2010.

By contrast, the national rate declined, from 16.7 percent in calendar year 2010 to 16.5 percent in the latest report. California’s rate also declined, from 22.1 percent in 2010 to 22 percent through March 31 of this year.

Bill Anderson, chief economist of DETR, said the minor change from the 2010 report to the first quarter of this year reflects more of a sideways movement than a further decline. The change is minimal, he said.

“I look at those numbers and I’m starting to see signs of stability,” Anderson said. “We’re starting to see outright improvement in our official unemployment rate, but looking at the broader measure it points towards stability – unfortunately stability at historically high levels of unemployment.”

The “Alternative Measures of Labor Underutilization for States, Second Quarter of 2010 through First Quarter of 2011 Averages,” shows six different jobless rates using different measures. The broadest definition, U-6, includes “discouraged workers,” defined as people who want work but who had not searched for work in the previous four weeks because they believed no jobs were available to them. It also includes “marginally attached” workers, defined as those who had not looked for work in the previous four weeks for any reason.

Finally the measure includes those employed part-time for economic reasons, defined as those working less than 35 hours per week who want to work full time, are available to do so, and gave an economic reason – their hours had been cut back or they were unable to find a full-time job – for working part time. These individuals are sometimes referred to as involuntary part-time workers.

The Bureau of Labor Statistics notes that the broader definition of unemployment is based on relatively small sample sizes at the state level.

Even so, DETR had this to say about the actual unemployment rate when it cited the figure in a release last year: “Use of the alternative measure of unemployment for research purposes is limited since the information is only available for the past five years, so comparisons to past recessions is not possible. But, from a policy perspective, the actual unemployment rate presents a more complete picture of what is currently occurring in the economy.”

“Despite the historic run up in the unemployment rate, the reality of the recession’s impacts on Nevada’s workforce is much worse than presented,” the agency said in reporting the number in August.

Nevada’s March jobless report showed some cause for optimism on the jobs front, however, showing an increase in employment over March 2010, the first expansion in 38 months. Total nonfarm employment in the Las Vegas area increased by 10,100, and is up 0.5 percent from the same month last year. Employment in the Reno-Sparks area increased by a modest 600 jobs, while employment in Carson City was essentially unchanged, adding just 100 jobs. Both areas have slightly more jobs now than they did a year ago.

“Nevada’s labor markets showed signs of life in March, hinting at what may be the beginnings of an economic recovery,” Anderson said in announcing the latest official monthly jobs report earlier this month. “Employment increased on an over-the-year basis for the first time since January 2008, and results of the household survey showed a solid decline in unemployment.”

Anderson said he does not have data to indicate whether Nevada’s recent job growth is in part-time work, which would drive the actual employment rate as reported by the Bureau of Labor Statistics higher.

“That kind of information just simply isn’t available, at least in a ready format,” he said.

Audio clips:

DETR Economist Bill Anderson says the change in the quarterly actual unemployment rate is minimal:

042611Anderson1 :32 state’s labor market.”

Anderson says the number shows stability, although stability at historically high levels:

042611Anderson2 :21 levels of unemployment.”

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