NV Labor Force Reaches Record; CA Unemployment Hits 5.1%

Recently, California (5.1 percent) and Nevada (5.4 percent) unemployment rates clocked-in at relatively much higher rates than the U.S. average of 3.7 percent, according to data released by the California Employment Development Department (EDD) and the Nevada Employment Training and Rehabilitation Department (DETR).

While California’s job market grew slowly in December 2023, its labor force (those willing and able to work) is still -234,000 below the state’s pre-pandemic level in early 2020. Meanwhile, as Nevada’s non-farm employment remained near an all-time high, its labor force (individuals needing a job) reached a record high.

The following are the latest year-over-year and month-over December 2023 trends recently published:

California’s December 2023 Employment Numbers
The California report shows the state’s unemployment rate rose to 5.1 percent in December 2023 (from a “readjusted” 4.9 percent in the month prior). For context, the state’s unemployment rate hit 16.1 percent at one point during the COVID-19 pandemic in 2020.

California employers added 23,400 non-farm monthly payroll jobs in December 2023:

• California’s labor force (pool of individuals willing and able to work) increased by 84,500 in December 2023 from one year before, but it declined -3,600 workers from the month before — and now sits at nearly 19.36 million. It also remains approximately -234,000 below its pre-pandemic level in February 2020 of nearly 19.6 million.
• The total number of Californians holding jobs (non-farm payroll, agriculture related, independent contractor/freelancers) was 18.37 million, which is down by -32,700 from the combined total employment level this time last year.
• Non-farm company payroll jobs now total 18.18 million. These jobs (a subset of “total” jobs) increased by 311,000 (1.7 percent) from December 2022 to December 2023 compared to a U.S. annual gain of 1.7 percent.
• Six of California’s 11 industry sectors gained jobs in December, with private education and health services (13,200) leading in gains thanks to above-average increases in nursing care facilities and individual and family services.
• Government (8,100) experienced job increases in both city government and special districts, with local government jobs within the state now showing seven consecutive months of increases.
• Leisure and hospitality (7,100) experienced job gains in the accommodation industry group, as well as the limited-service restaurants and “other” eating places industry groups.
• Month-over losses in professional and business services (-3,800) were largely due to reductions in employment services.

Nevada’s December 2023 Employment Numbers
The Nevada report shows employment in the state was up 6,000 jobs in December 2023 (month-over change) and 57,700 jobs from a year ago (3.8 percent annual increase) — which consists of non-farm payroll company/organization growth.

Total Nevada employment — which includes all non-farm payroll, agriculture/farm jobs, and any independent contractor/freelance jobs — stood at more than 1.53 million individuals in November 2023. (When it comes to payroll employment specifically, June 2022 was the first month Nevada’s job market finally closed the gap inflicted since the COVID-19 recession in 2020.)

Nevada’s December 2023 unemployment rate stood at 5.4 percent (from a “readjusted” and unchanged 5.4 percent the month before), which is up from 3.7 percent in February of 2020 (pre-pandemic economy). For context, the state’s unemployment rate hit 28.2 percent at one point during the COVID-19 pandemic in 2020.

At the local/regional level, Nevada’s non-farm company payroll employers added, subtracted, or experienced the following trends in December 2023:

• Las Vegas-area employment increased 0.1 percent (800 jobs) in December 2023 from the month before and by 45,900 jobs (4.1 percent) since December 2022.
• Reno/Sparks-area employment decreased -0.3 percent (-800 jobs) in December 2023 from the month before, but it increased by 5,700 jobs (2.1 percent) since December 2022.
• Carson City-area employment decreased -0.6 percent (200 jobs) in December 2023 from the month before, but it increased by 600 jobs (1.9 percent) since December 2022.
• For the first time in Nevada, the accommodation and food service industry employs more individuals than before the COVID-19 pandemic.
• Seasonal retail hiring increased above the level seen from 2018 to 2022.
• The Nevada labor force (those willing and able to work) grew by about 6,300, marking 12 months of consecutive increases and giving the state its largest labor force ever (more than 1.62 million).

Ongoing Labor Market Perspective
These California and Nevada job market recoveries don’t account for lost ground and opportunity costs coming out of the COVID-19 pandemic.

Specifically in California, the state’s labor force — the pool of individuals willing and able to work — shrunk drastically due to public health restrictions and concerns, policy and employer decisions, the volatile business environment, federal and state financial relief, and worker fluidity in a tight labor market.

Essentially, both California and Nevada job markets may have been even more robust by December 2023 if COVID-19 never impacted the economy and policy decisions, assuming no other negative financial or economic events transpired.