Something big is going to happen to employment in Nevada in September. No one is entirely certain what’s going to happen, and experts aren’t certain how it’s going to unfold. One thing everyone agrees on is that it’s going to be big.
Why? September marks the end of supplemental unemployment benefits funded by the federal government as part of its pandemic-recovery packages, and jobless workers will feel more financial pressure to get back to work.
“The floodgates will open when unemployment benefits expire in September 2021, and the currently unemployed will need to get back to work or start looking for work,” said Demont Daniel, who manages the North Las Vegas office of PrideStaff, a staffing agency.
Daniel explained that unemployment benefits average around $700 a week, or $17.50 an hour. That translates to about $36,000 a year — a figure that often allows jobless workers to be very picky about the positions they’ll consider. Their pickiness has proven frustrating for employers large and small who have vacancies, see potential candidates on the sidelines and can’t woo them back to work.
Employment specialists in the state government, meanwhile, are highly motivated by the same calendar. “We’re strongly focused on the next four months,” said Elisa Cafferata, director of the Nevada Department of Employment, Training and Rehabilitation.
Working with public- and private-sector partners, state employment officials have stepped up training programs and strongly encourage jobless workers to strengthen their skills as quickly as possible. The training initiatives are especially critical, Cafferata said, for people who held the estimated 50,000 jobs that probably disappeared permanently at the start of the pandemic. Many of those positions were in the gaming, hospitality and travel industries.
Labor Market
Workers with all sorts of skills — everyone from entry-level construction laborers to executives with advanced degrees — find themselves in demand as the Nevada economy rebounds from the COVID-19 pandemic.
“The demand in unbelievable,” said Celeste Johnson, chief executive officer of The Applied Companies, a staffing and HR-outsourcing company headquartered in Reno. “This is absolutely a job-candidates’ market.”
Doing a few back-of-an-envelope calculations, Johnson estimates there are about 20,000 open jobs in northern Nevada. The problem: There are only about 12,000 available workers, and a good number of them have issues that make them less-than-ideal job candidates.
Researchers in the state employment department, in fact, believe that the labor market in northern Nevada now has returned to pre-pandemic levels. Cafferata said the region’s robust recovery reflects the success of economic-diversification efforts during the last decade that dramatically increased manufacturing and technology employment.
Las Vegas, heavily dependent on travel and tourism, has seen a slower jobs recovery. Close to 300,000 people worked in leisure and hospitality jobs before the pandemic. Today, even as casinos, hotels, and restaurants reopen, the number barely tops 200,000.
“With hospitality and tourism essential to the economy, there is definitely a case to be made that Las Vegas was more shut down than other cities,” said Fred Lovingier, district manager in Las Vegas for Insperity, a provider of human-resources services.
In fact, the unemployment rate in the Las Vegas metro area this spring stood at 8.8 percent, a figure that was well above the national unemployment rate of about 6 percent. By comparison, the jobless rate in the Reno-Sparks area was 4.6 percent. But employers’ hiring plans appear to be rebounding quickly in the Las Vegas region.
Demand Fields
Daniel says demand for workers increased exponentially after local governments took over COVID-19 mitigation efforts this spring. Rapidly reopening or expanding businesses hired hundreds of workers in fields ranging from administration to general labor, from accounting to housekeeping.
Particularly strong demand, Daniel said, is coming from the logistics sector as warehouse and distribution operations open across the Las Vegas Valley and look to ramp up their employment very quickly.
PrideStaff has redoubled its recruitment effort in that sector, launching new traditional marketing programs as well as digital campaigns that target potential employees. Pent-up demand for travel could add more fuel to employment growth in the Las Vegas region, analysts for the state government say, and they’re already seeing increases in airline-related employment. That growth, in turn, improves the outlook for employment in the multitude of companies that provide professional services to hotels, casinos and restaurants.
Cafferata said state analysts are seeing strong demand, too, from the construction trades in southern Nevada. Apprenticeship programs in those fields — including those involved with solar installation — are playing an important role in retraining Las Vegas-area workers whose tourism-related jobs may not return, she says.
With the return to pre-pandemic employment in northern Nevada, Cafferata said employers face substantial wage pressures from a competitive market. “We expect that to continue at least through the summer,” said the employment department director.
Competitive Jobs
Johnson says Reno-area jobs that paid $14 an hour a couple of years ago now pay $20. Smaller locally owned companies find themselves in bidding wars with the national firms that are hiring hundreds of workers for new northern Nevada operations. And more than simply offering higher pay may be necessary, Lovingier said.
“Employers have to adapt or change tactics to offer more enriching programs, more complete compensation packages and concentrate on appealing to top candidates,” he said. Remote work opportunities, for instance, allow companies to recruit more widely, Lovingier said. In the video interviews that now are a common first step in the interview process, candidates and employers alike expect to talk about remote-work expectations from the start.
“Internal hiring also is critical to the recovery, as employers focus more on developing talent already on hand,” Lovinger said.
In a related development, Daniel said many employers appear to be stepping up training programs to strengthen the skills and complete technical certifications of staff members who have switched careers or just joined the workforce.
JobConnect, the state’s employment service, is doing its part to connect employers with jobseekers. The agency is conducting virtual job fairs, helping employers with recruitment and screening and spreading the word about programs that offer financial incentives to employers who provide on-the-job training. The state also is giving those sidelined workers a shove to get back to work, Cafferata said.
Unemployed workers who decline a suitable job offer now face loss of their jobless benefits, a requirement that was suspended at the start of the pandemic crisis. And recruiters are getting more creative.
With executives in high demand in northern Nevada, Johnson said recruiters at The Applied Companies increasingly look for executive candidates whose skills in one industry might be transferrable to another. That trend got a boost from the disruptions of the pandemic.
Executives who found their routines turned upside down — working from a spare bedroom rather than a corner office, fending off the family dog during Zoom meetings — now may be more open to hearing a recruiter’s pitch for a significant career change. No matter the tactics they’re adopting, HR professionals across the state said employers will need to recruit almost constantly in the post-pandemic economy.
“The race for talent is on,” said Johnson. “Companies need to be proactive. They need to understand the costs of vacant positions. They have to start budgeting strategically for recruitment, and that doesn’t mean just putting ads on an Internet job board.”
Johnson is so convinced, in fact, that she recently added ongoing recruitment processes to The Applied Companies’ menu of outsourced HR services.
New Rules
Johnson noted, too, the pandemic meant companies faced federal rules that became very complex very quickly — regulations about health coverage for COVID-19 treatment, for instance, or rules surrounding the Payroll Protection Program (PPP). Employers also were wrestling with a myriad of their own is – sues such as work-from-home policies after offices shut down.
Employers turned to HR outsourcing firms for help through the pandemic, and they appear to be sticking around as the recovery unfolds. “I don’t anticipate that the world is going to become less regulated or less complicated any time soon,” Johnson said.
Lovingier, meanwhile, expects the growing complexities of recruitment and HR-related compliance will mean growing interest in professional employer organizations (PEO). A PEO essentially leases workers to an employer, allowing companies to focus on their core business competencies while outsourcing HR functions such as recruitment, payroll administration and workers compensation administration.
“As the new normal takes shape, businesses are working harder than ever to maintain profits. Las Vegas employers are now challenged to deal with the workforce in ways they may not be fully prepared to manage,” said Lovingier.
The pandemic added substantially to the complexities of the workplace, said Nevada Labor Commissioner Shannon Chambers. Beginning in March 2020, the Labor Commissioner’s office issued 14 COVID-related bulletins, advising employers and workers about everything from emergency federal rules on sick leave to questions about whether employees could be required to use vacation time if they were quarantined after a COVID-19 exposure.
Today, Chambers said the questions continue, but they reflect the changing face of the pandemic and the economy’s sharp rebound. Employees are asking, for instance, if they are required to return to work if they have concerns about COVID exposure. Hourly workers have lots of questions about overtime. Salaried employees, too, are asking how many hours of work their employers can require.
The arrival of many new employers in the state also is generating calls to the Labor Commissioner. Those new arrivals, Chambers said, sometimes are surprised to discover that Nevada’s labor laws are complex with, for instance, its two-tier system for minimum wages that’s linked to payment of health benefits. “We’re working to help employers understand the law and do it right,” she said.
With a staff of only nine investigators to track down employment-law violations statewide, the Labor Commissioner relies heavily on education and the desire of the vast majority of employers to do the right thing.
(The schedule of educational sessions is found on the Labor Commissioner’s Web site, labor.nv.gov.)
“We’re still going to go after the bad actors and the intentional actors,” Chambers said. “But our focus is to help employers comply with the law and do the right thing. We’re not here to play ‘gotcha’.”
Combating Fraud
Even as employers position themselves for a tighter labor market in a recovering economy, the state government still is sorting out what appears to have been widespread fraud attempts against the unemployment compensation system at the start of the pandemic.
Cafferata said the state received about 2 million applications for unemployment assistance — a remarkable number, given that only about 1.5 million Nevadans in total were working at the start of the pandemic, and 70 percent of them kept their jobs.
“It was far beyond anything that a reasonable person would expect,” said Cafferata.
The state still is working with law enforcement agencies to investigate about 400,000 apparently fraudulent claims, including more than 300,000 filed in the special benefits program for gig workers such as Uber drivers who lost their jobs.
(Employers who believe they are victims of unemployment fraud can file a complaint by clicking the “Unemployment Fraud” tab on DETR.nv.gov.)
In the meantime, tightened requirements for identification with jobless claims appears to have sharply reduced the potential for fraud. State employment officials are keeping a close eye, too, on the fund that’s used to pay unemployment compensation to jobless workers.
The fund, which is financed by employer contributions, was quickly drained when Nevada’s jobless rate skyrocketed to about 30 percent in mid-2020. By the start of this spring, the fund had borrowed more than $300 million from the federal government so it could continue paying benefits.
Cafferata noted that the trust fund ended up $850 million in the hole during the Great Recession, a deficit that wasn’t fully repaid for eight years. Currently, the federal government isn’t charging interest on the state’s borrowings for unemployment, which removes some of the pressure for fast repayment.
Then, too, funds will begin to right itself as the economy recovers. As employers add to their headcounts, they’ll be increasing their contributions to the unemployment fund. Equally important, workers who get jobs will stop collecting benefits, decreasing outflows that reached tsunami-like proportions just 15 months ago.
