(i) Employment and Unemployment

As of March 2016, Nevada’s current level of employment has reached 1.27 million. Employment in Nevada has grown by 31,600 jobs year-to-date, compared to the same period in2015. When compared to 2010, Nevada has added 171,400 new jobs in period ending in March 2016. Employment is continuing to trend higher, although recent employment estimates indicate that the rate of growth may be slowing. This growth has been seen across all industries with the exception of mining.

Unemployment has decreased to 5.8 percent in March 2016, down from 6.9 percent a year ago, and down from 13.4 percent at the height of the recession. Similar to employment, the rate of improvement in the unemployment rate has recently slowed. One of the primary reasons for this decline is a surge in the labor force. When individuals reenter the labor force without a job, they place upward pressure on the unemployment rate, even as more jobs are being added to the economy and fewer people are applying for unemployment insurance benefits. This increase in the labor force is a good indication that individuals are feeling more confident in their abilities to locate employment. The labor force grew by nearly 24,000 in 2015, and is up 12,800 so far this year.

By utilizing the Silver State Solutions system to produce real-time labor information about current demand occupations and industries, DETR’s Research and Analysis Bureau has the ability to analyze current trends not only in Nevada, but also nationwide. Information pertaining to occupations, skills, certifications and requisite education can be acquired from this system. Collaborative discussions and engagements with the industry sectors is another way of identifying existing occupations. Other means of obtaining information include data reporting and analyses conducted through DETR’s Research and Analysis Bureau, NJCOS, NCIS, GOED, and the U.S. Department of Labor.

(ii) Labor Market Trends

Provide an analysis of key labor market trends, including across existing industries and occupations.

Nevada quarterly employment forecast: Second quarter, 2015 - fourth quarter 2018 (short-term projections):

Nevada was the state most negatively affected during the recession, mostly due to above average levels of employment in the construction industry and the state’s reliance on tourism and gaming. Both of these sectors were extremely hard-hit by the economic downturn. Nevada’s initial recovery lagged the national economy, but the economic situation is improving in Nevada. For instance, private sector job growth in Nevada during this year’s first three quarters, at 3.8 percent, was the third highest in the nation.

In this forecast, the state predicts that employment will surpass the peak levels achieved in 2007; set to occur in mid-2016. To put this in perspective, Nevada lost about 175,000 jobs from peak to trough. In 2011, the Nevada economy created 6,800 jobs, equating to a 0.6 percent increase. In 2012, employment grew 1.5 percent, or 17,100 jobs. Job gains have continued to accelerate into 2015; through the 2015 second quarter, job gains stand at 4.0 percent (i.e., 51,800 jobs) below the peak. Job gains are predicted to be at 45,800 by the end of 2015 reporting, 52,500 in 2016, 58,400 in 2017, and 65,100 in 2018.

Nevada experienced a rapid construction boom that was fueled by strong population and employment growth in the two decades leading up to the recession, but also by easy credit and speculation. The housing crisis left Nevada in a deep hole in terms of jobs. Construction employment plummeted for almost six straight years, bottoming out in 2012 with the loss of over 90,000 jobs. The pronounced losses in construction employment were, in large part, an adjustment from the exceptionally high levels prior to the start of the recession.

Construction activity turned positive again after the 2012 trough, and has been trending upwards since. This growth is being driven by projects in both the northern and southern metro areas. Notably in the north is the Tesla battery manufacturing plant (‘Gigafactory’), which began construction in 2015. In southern Nevada, construction on the Las Vegas strip is rebounding with the Genting Group project on the former Stardust/Echelon site, and the new MGM Resorts arena. In 2015, Nevada added 6,300 construction jobs, with an additional 7,500 jobs in 2016, 7,900 jobs in 2017, and 9,300 jobs in 2018. As projected, 2018 construction jobs would still be 48,000 below the pre-recession peak.

Manufacturing slumped in the deep recession as households and businesses cut back spending, creating lower demand for factory goods at home and abroad. Employment in this sector decreased dramatically during the recession, losing 12,500 jobs from peak to through recession period, and has been slow to recover. However, the manufacturing sector is gearing up for a true recovery in the coming years, due in part to the resultant employment effects of the Tesla’s Gigafactory. The employment gains that will be realized at this one facility will account for approximately 14 percent of manufacturing employment in Nevada. In 2015, we forecast 1,300 more jobs in the manufacturing sector, followed by gains of 2,200 in 2016, 2,900 in 2017 (when the bulk of Tesla’s employment will be filled), and 3,200 jobs in 2018. Another noteworthy project in this industry is Faraday Future’s electric car manufacturing plant. This factory is expected to add 50 jobs in 2015, 250 jobs in 2016, and an additional 700 jobs in 2017; the total projected jobs associated with this project added by 2025 are estimated at 4,500.

Southern Nevada, which drives Nevada’s economy, is heavily dependent on tourism, conventions and gaming, which in turn feeds the retail industry. Retailers rely on consumer spending and disposable income. The latter two are a reflection of the relative strength of the economy; therefore, it is no surprise that consumption plummeted during the recession. Nevada’s economy had a rash of store closings and vacant retail space when the recession hit. As the recession unfolded, retail employment fell by 12,700 from its peak employment of 140,500 in 2007, to 127,800 in 2010. Since then, retail employment has been in recovery.

Improved household balance sheets are facilitating pent-up demand. As job growth accelerates, consumers will gain more confidence. The retail sector in Las Vegas will benefit from the construction developments on and around the Las Vegas Strip as many of them include retail space. We are projecting 4,800 additional jobs in 2015, 5,600 jobs in 2016, 6,300 jobs in 2017, and 7,900 jobs in 2018.

Demographics are the main driver of the growth in the number of jobs in the health care and social assistance sectors. Employment in the individual and family services industries, which provides a variety of social assistance to children, elderly people, people with disabilities, and others, is projected to increase as well. Our projections indicate an additional 4,500 jobs in 2015, 5,700 jobs in 2016, 6,500 jobs in 2017, and 7,100 jobs in 2018.

The hospitality and food service industry has the largest share of employment in Nevada, accounting for about a quarter of all jobs in the state. Most hospitality and food services jobs are concentrated in the Las Vegas area. The fact that the Las Vegas economy is dependent on tourism and has a consumption-based economy makes it very susceptible to the national economy’s ups and downs. Thus, the success of the industry depends on people having disposable income to spend.

Employment in the accommodation and food services industries reached its peak in the 2007. The recession cost the sector 26,900 jobs before the recessionary bottom was reached in 2009. Tourism related employment has steadily increased since the end of the recession. Construction developments on and around the Las Vegas strip will have a significant impact on the accommodation and food services sector employment. The forecast estimates 11,700 additional jobs in 2015. The state anticipates additional gains of 12,700 jobs in 2016, 13,600 jobs in 2017, and 14,400 jobs in 2018.

Additional data sources and partnerships are currently being developed, which will be able to provide further insights into Nevada’s labor market. DETR’s Research and Analysis Bureau provides both short- and long-term industry and occupation projections. In accordance with information garnered from data inquires and reporting from the NJCOS and the Silver State Solutions system, insight is gained on emerging demand industries and occupations. The Silver State Solutions system can be used to help identify emerging occupations combined with requisite training, skills and education associated with said occupations. Through analyses of online job posting data, Silver State Solutions’ queries provide an overview of current and future workforce needs by identifying: job types, job posting age, job locations, requisite experience, education, and/or certification requirements. Working with GOED, the Las Vegas Global Economic Alliance (LVGEA), the Economic Development Authority of Western Nevada (EDAWN), and other economic development stakeholders, information is gathered and compared to identify the emerging needs of the industry sectors to validate information derived from the Silver State Solutions system, the U.S. Department of Labor, DETR’s Research and Analysis Bureau, and other resources.

The 2011 Brookings-SRI report: An Economic Development Agenda for Nevada, assisted GOED and DETR in the determination of targeted industry sectors for Nevada. Based on this report and other data and intelligence gathered from GOED and DETR, seven industry sectors were initially identified, to-wit: aerospace and defense; business information technology (IT) ecosystems; clean energy; health and medical services; logistics and operations; mining, materials and manufacturing; and, tourism, gaming and entertainment. Subsequently, agriculture was added and in October 2015, the state board refined said industry sectors based on the current needs of Nevada employers, to-wit: aerospace and defense; health care and medical services; information technology; manufacturing and logistics; mining and materials; natural resources (includes agriculture, clean energy and water technologies); tourism, gaming and entertainment. Real-time data is obtained and reported through the Silver State Solutions system.

(iii) Education and Skills Levels of the Workforce

Provide an analysis of the educational and skill levels of the workforce.

According to the American Community Survey on Educational Attainment’s five-year estimates (2010-2014), roughly 59 percent of all Nevadans (civilian labor force, age 25-64) possessed more than a high school diploma. Of the approximate 10 percent of the population that were unemployed, only 1.4 percent possessed a bachelor’s degree or higher with a similarly small percentage having less than a high school diploma. The largest portion of the labor force, nearly 35 percent, possessed at least some college.

When comparing educational attainment to current occupational staffing patterns, Nevada’s current workforce indicates a nearly 10 percent shortfall in advanced degrees holders. Interestingly, the data indicates that nearly 20 percent of the workforce, primarily those with some college but less than a bachelor’s degree, may be working in occupations that require less formal education than they possess. It is important to note that although there seems to be an excess of education according to the chart, this does not take into account businesses using education as a sorting tool for hiring, mismatches in degree subject compared to available jobs, or the needs of emerging occupations/industries that are not currently reflected in the staffing patterns. These trends have also not been compared to national trends to determine if this is a local issue, or a national development.

The employment needs of Nevada employers are identified by working closely with educators, economic development, labor and community organizations, utilizing surveys, and through candid discussions with the sector councils. Additional information about critical jobs, requisite skills and competencies needed, and the training and education that may be required can be obtained from the Silver State Solutions system once it is fully implemented. The most beneficial resource tool will be working with the Silver State Solutions system along with DETR’s Research and Analysis Bureau, the Nevada System of Higher Education (NSHE), NJCOS and GOED to produce real-time and relevant analyses of Nevada’s workforce needs.

(vi) Skill Gaps

Gaps between current and future skill demands have not yet been projected, but are in the process of being identified, analyzed and assessed. The Governor’s recent Executive Order 2016-08 regarding workforce development calls for, amongst other things, a streamlined and more efficient network of sector councils within Nevada. There will be a particular focus on providing workforce intelligence necessary to identify both current and future skill gaps likely facing the State’s private sector employers. The efforts of the sector councils will incorporate forward-looking and consensus-model data sets to better and more fully inform the state and local boards, K-12 education and postsecondary planning activities.

Additional skill gap analyses may become more apparent and available through the Silver State Solutions system once it is fully implemented. These tools will provide real-time access to information regarding the skills, education, and experience that are in-demand on the part of Nevada employers.