• Clark County will add about 100 to 200 jobs per month — too little to push down unemployment.
• Government employers will cut jobs.
• At least 400 people will exhaust unemployment benefits through April, perhaps more after that.
Back to 2011 Economic Forecast Breakfast home page.
Last year I wrote, “I am guessing that total Clark County employment will remain largely unchanged in 2010. Slow hiring will translate into a stubbornly high unemployment rate.” That proved to be a pretty fair summary for the 2010 labor market.
Unemployment was high all year, with November’s preliminary rate at 13 percent. On a seasonally adjusted basis, nonfarm employment in November 2010 was 200 jobs below the January 2010 level. Most industries were trending flat over the past six months of the year.
What lies ahead for 2011? I don’t know what’s going to happen. But I wouldn’t be surprised if the county ended the year with a modest increase in jobs.
First, a few comments about the national economy. The production of goods and non-financial services gives every appearance of being in a slow recovery. Growth could be much higher than most observers were predicting only six months ago, with gross domestic product increasing at 3.5 to 4 percent.
The fly in the ointment — or at least one of the flies — is the deep budget shortfall in many state governments around the nation.
A respectable growth rate will increase hiring, but not enough to put much of a dent in unemployment. The financial sector is still weak, overleveraged and predatory. Many of the factors that sank the economy in 2007, such as unregulated credit default swaps, are still in play. Maybe not this year, maybe not next, but at some point the chickens will come home to roost, and we may again pay the price for policymakers not adequately reining in the banking system.
Locally, I’m guessing we’ll see job growth at about 1 percent, 100 to 200 jobs per month, on the order of 1,200 for the year. This will have little impact on the unemployment rate. Considering that we lost over 9,000 jobs in the recession, we will still be in a very deep hole.
Industries that I expect to contribute the most new hires: temp agencies, wholesale trade, retail trade, health care, and professional services.
I expect little in the way of employment recovery in construction in 2011. While the prospects for manufacturers are improving, that doesn’t appear to mean any kind of a substantial boost in jobs.
Information, finance and real estate don’t look to be job generators, with the exception of Fisher Investments, which may add another 100 employees this year.
Government employment will lag somewhat in the beginning of the year, with more cuts in the second half.
Economic strain on Clark County households will continue. There will be more foreclosures, more people exhausting their unemployment benefits — at least 400 a month through April, perhaps more after that.
Median household income dropped by 5 percent in 2009, and there was a sharp increase in low-income households.
Almost one out of seven households qualified for food stamps, up from 8 percent in 2008. More than half of our rental households are in economic distress because rent eats up a third or more of their income.
None of this is surprising, considering that there was a disproportionate loss of lower-wage jobs.
The recession has been most cruel to those with the least resources to begin with.