From an economic perspective, September represented notable gains in a few key statistics. While there are a number of encouraging signs that a sustained recovery is taking hold, Nevada continues to report a population that appears hesitant to reenter the labor market, potential weakness in the important high-roller segment of the tourism sector, and continued declines in commercial lease rates.

Nevada’s unemployment rate fell 0.3 percentage points to 11.8 percent in September. This reversed the recent upticks in unemployment that occurred in July and August. A key contributor to the reduction was the creation of 8,400 net new jobs during the past 12 months. Also helping push the rate down are people rolling off the unemployment insurance rolls. There were only 13,932 initial unemployment insurance claims in September and 124,637 continuing claims, the lowest rates since September 2007 and November 2007, respectively.

Despite these improving fundamentals, most of the lower unemployment rate can be explained by the shrinking labor force. The total number of Nevadans employed or actively seeking employment has fallen by 2.0 percent since September of last year. Continuing weak economic conditions are discouraging potential workers from entering the labor force and also causing those who have unsuccessfully sought employment for an extended period to merely sit on the side lines until conditions improve. Although there was a small bump in the labor force during the summer, since June, the Nevada labor force has lost 10,000 jobs (0.8 percent).

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