Employment divide: Jobs data show a tale of two Nevadas amid COVID-19, Great Resignation

Some areas and industries are thriving while others continue to be hit hard by the pandemic’s impacts, an analysis of employment data found.

Steve Ferguson sat quietly in his car at a south Reno parking lot last spring, the anxiety slowly building in his head as he stared at the seemingly dystopian scene before his eyes.

Just a few months earlier, Ferguson was excited about opening his new business — a chopped salad restaurant aimed at leveraging the boom in wellness and healthy eating. On April 1, 2020, Ferguson finally inked a deal for a spot at the South Towne Crossing shopping center after six months of negotiating.

Like a bad April Fool’s joke, however, COVID-19 was wreaking havoc in the community at the exact same time.

“So I was there, sitting at the parking lot near Walmart and almost everything was shut down,” Ferguson said. “The parking lot was empty.”

The Great Resignation: Why are employers struggling to find workers?

Ferguson decided to push forward and opened his Chop Stop restaurant in October. What followed was a front seat to the employment roller coaster known as the Great Resignation as Ferguson joined the ranks of business owners struggling to hire and retain employees since the pandemic started.

It’s a wild ride that played out as recently as Jan. 7 when one of Ferguson’s shift leaders walked into the restaurant. The guy quit right before his shift and left. The restaurant closed at 4 p.m. that day and also closed early for the rest of the weekend.

“Few workers give two weeks’ notice anymore,” Ferguson said. “It’s frustrating.”

Meanwhile, about three in four applicants fail to show up in their interviews as Ferguson constantly has to replace people due to a high turnover rate. 

It’s a story that continues to be seen nationwide in restaurants, hotels and a huge swath of the service industry, which has been hit especially hard by high staff turnover and difficulties in finding new employees. 

It’s also a tale that shows just one side of the same coin.

Even as the nation continues to grapple with the impact of COVID-19, data tells two different stories when it comes to employment numbers as some sectors thrive while others struggle. 

It’s a scenario that is also playing out in Silver State, where recovery can sharply vary not just by area but by industry and demographics as well.

What happens in Vegas stays in Vegas

Before the pandemic, Nevada was firing on all cylinders for employment.

The jobless rate statewide in February 2020 was just 3.7%, according to the Nevada Department of Employment, Training and Rehabilitation. Any area with an unemployment rate below 4% is considered to have “full employment,” meaning any person who wants a job can usually find one.

“Prior to the pandemic, unemployment claims were the lowest relative to the size of the workforce that we’ve ever seen going back to the 1990s,” said David Schmidt, DETR chief economist. 

“That was a decade of fairly stable levels, roughly one claim for every 1,000 jobs in the state. At the start of the pandemic, we had about 0.8 claims (per 1,000 jobs) so it was 20% lower.”

Just two months later, however, the employment script completely flipped. In April of that year, Nevada posted the highest unemployment rate ever recorded by a state in U.S. history. At the time, the state’s jobless rate skyrocketed to 28.2% after Gov. Steve Sisolak mandated a statewide shutdown of non-essential businesses in March due to COVID-19 concerns. 

Jobless claims reached 91,000 that month alone — 10 times higher than the previous monthly record of 9,000 back in the Great Recession, Schmidt said. March also saw a sobering 247,000 layoffs and discharges of employees across the state, according to the Bureau of Labor Statistics.

Fast forward to today and Nevada’s jobs situation is much improved. Jobless claims in the last month finally fell to pre-pandemic levels, which hovered at about 2,000 per week before COVID-19. Unemployment was also below 7% in November, although it still trailed the national rate of 4.2%.

A closer look at the numbers, however, also show two different Nevadas when it comes to the state’s employment picture. In Las Vegas, the jobless rate in November was 6.4%, with North Las Vegas posting the highest rate in the state at 7.6%. In contrast, Reno was already back to full employment with a jobless rate of just 2.9%. 

The dichotomy can’t be simply chalked up to a north-south divide. The southern city of Mesquite, which is just an hour and a half away from Las Vegas, also has a much lower jobless rate at 4.1%. 

Sin City’s woes compared to the rest of the state provide a valuable hint on how the pandemic is impacting and even shaping the economy in different ways.

“The effect is dramatically different depending on where you look at in the state,” Schmidt said. “Even within Clark County, if you look at Boulder City or Mesquite or Las Vegas and North Las Vegas, you see very different impacts there.”

“What’s happening in Las Vegas is telling and worth noting,” Schmidt added.

The Great Retention?

In an employment landscape dominated by horror stories about employers’ difficulties in finding and keeping employees, printing business Reno Type is not quite a textbook example.

Unlike many other small businesses, the company has kept all its employees since the pandemic — the last time an employee left was about three and a half years ago. Reno Type was also able to recently add new hires to its roster without much difficulty, much to the surprise of its president, Kurt Hoge.

“I was just terrified because people said I won’t be able to find any qualified applicants,” Hoge said. “But I got plenty of qualified applicants; everyone showed up for their interview and both new hires were excellent candidates who showed up for work.”

The answer behind Hoge’s positive experience sheds light on why Reno is faring better than Las Vegas when it comes to its economic recovery from the pandemic. It basically boils down to a more diversified portfolio, or at least one that is not heavily reliant on sectors hit hardest by COVID-19.

Like many positions in the technical sector, Hoge’s business typically offers higher wages than restaurants and other service industry jobs. Based on employment data, such jobs are seeing more success with hiring and retention compared to positions that offer lower pay.

A look at DETR data for Washoe County, for example — which includes the cities of Reno and Sparks — shows that it was down by more than 5,800 jobs in 2021 compared to 2019, which was the last full year prior to the pandemic. Those losses, however, were primarily concentrated in a few sectors. At the top of the list is the service and accommodation industry, which was down by about 6,400 jobs. The sector includes restaurants, casinos and hotels.

“If you strip out that sector, Washoe County is actually up by 665 jobs,” Schmidt said. “Construction, technical and health services, transportation, warehousing, all of those were up.”

While gaming is still a key sector in Reno-Sparks, it is no longer the primary driver of the Northern Nevada economy. The switch can be traced back to the advent of tribal gaming in California, which reduced traffic from Reno’s main feeder market for gambling and forced The Biggest Little City to diversify its economy by targeting such sectors as logistics, advanced manufacturing and technology. Northern Nevada’s distribution sector, in particular, has been absolutely humming since COVID as lockdowns and social distancing caused online ordering to skyrocket.

“One of the positive results of the times right now is we’re seeing better pay for drivers … and that’s probably something that has needed to increase for many years,” said Scott Pruneau, CEO of ITS Logistics.

“Actually, it’s not just drivers. That wage scale is picking up for many professions, which is a good thing for everybody.”

Meanwhile, Las Vegas remains highly reliant on gaming and tourism despite its own efforts to diversify. Las Vegas’ reputation as a global gaming destination also means it is more affected by downturns in international travel. A spate of COVID variants continues to curtail visits by people from other countries, with delta and now omicron fueling lockdowns and curtailing international flights.

“As an industry, accommodation has been hit harder in both the north and the south but things have gone better in (Northern Nevada),” Schmidt said. “The south has the Strip and a much higher concentration of jobs in accommodation and food service.”

Separation anxiety in the Silver State

A lone employee waits at a bus stop at the Grand Sierra Resort just before 11 p.m. on a chilly Monday evening.

A couple of minutes later, headlights appear from a nearby corner as the familiar sound of a bus rings through the cold winter air.

Just a little over a month removed from wrapping up labor negotiations that turned acrimonious at times, bus contractor Keolis North America — which manages the public transit system for the Regional Transportation Commission of Washoe County — is looking for new drivers. Keolis, which is holding three job fairs in January, says it is currently looking to hire for 40 positions. 

Staffing was already a challenge even before three bus strikes paralyzed the Reno-Sparks public transit system last year until a new collective bargaining agreement was reached.

“COVID has presented hiring challenges in the transit industry and we’re seeing impacts to all industries in terms of recruiting,” said Justin Thompson, a spokesman for Keolis North America. “The workforce market is a little tighter right now.”

A look at the latest data from October shows that Nevada had 109,000 job openings.

In comparison, Nevada businesses laid off 16,000 employees during the same period, far below the 79,000 hires that placed the state third in the nation for its rate of hiring new employees.

One of the more telling numbers, however, involves the number of Nevadans who quit their jobs. In a sign that the Great Resignation continues to impact the Silver State, 48,000 employees resigned in October. The number equates to a 3.5% quit rate, which is tied for fourth-highest among all states.

At the local level, an analysis of data from the Nevada Department of Employment, Training and Rehabilitation shows that Washoe County has about 5,800 fewer filled jobs overall compared to 2019. The bulk of the decline involves workers in their 20s and mid-30s and those ages 45 and older.

Two age groups actually posted employment gains since the pandemic: employees aged 14-to-18 and 35-to-44 gained 553 and 310 jobs, respectively.

The employment trends among the various age groups each tell a different tale. 

Teens are a prime source of labor for jobs that pay lower wages, which also happen to be the jobs that have seen massive turnover — especially among employees who…

Read More: Employment divide: Jobs data show a tale of two Nevadas amid COVID-19, Great Resignation

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