In March 2020, a national state of emergency was issued in response to the COVID-19 pandemic spreading across the globe, creating unforeseen social and economic uncertainty. To date, the coronavirus has infected over 34 million people throughout the world and has been responsible for over 1 million deaths. Southern Nevada has been greatly affected, as well, with over 67,000 cases and over 1,300 deaths. The economic crisis that stemmed from the public health crisis has also been profound, resulting in hundreds of thousands of job losses.
As infections climbed in March, Governor Steve Sisolak ordered nonessential businesses to close, including the resort hotels at the center of the regional tourism economy. As a result of businesses temporarily closing their doors, Southern Nevada’s nine years of job growth came to an end as the unemployment rate reached a historic high of 34 percent in April, the highest rate in the country. Over the course of a month, Southern Nevada lost 227,700 jobs from March to April. However, over the past four months, Southern Nevada has made substantial progress in reopening business and returning employees to work. As of August, the unemployment rate dropped 18.5 percentage points since April and currently stands at 15.5 percent. The region has added 115,900 jobs since April to bring total employment to 908,500, 12.1 percent below February levels.
With Southern Nevada’s relative dependence on tourism, the region’s leisure and hospitality was hit hardest. Over the course of one month, the leisure and hospitality sector lost 124,300 jobs from March to April. However, since casinos were able to reopen on June 4, the sector regained 67,100 between April and August. The leisure and hospitality sector remains down 72,600 jobs from August 2019. Other sectors that suffered negative employment growth included professional and business services (-21,400 jobs), trade, transportation and utilities (-17,000 jobs), education and health services (-5,900 jobs), other services (-4,700 jobs), construction (-2,300 jobs), information (-2,000 jobs) and manufacturing (-1,400). A few industries have gained employment over the past year, including financial activities (+700 jobs), government (+200 jobs) and mining and logging (+100 jobs).
The state’s initial unemployment insurance claims also reached record levels during the height of the pandemic. Initial claims jumped from 9,815 claims in February to 208,869 claims in March, overwhelming the state’s unemployment system. The COVID-19 pandemic is responsible for Nevada’s 20 highest weeks of initial unemployment insurance claims. Initial claims have dropped 76.3 percent since March to 49,595 claims in August. Continued weekly unemployment claims, an indication of ongoing joblessness, have also declined significantly since peaking at 622,000 in mid-May. Continued claims totaled 334,200 in mid-September, a notable improvement but still elevated compared to historical levels.
The short-term implications of COVID-19 and the related response have been substantial. The reopening of businesses has helped return tens of thousands of people to work, and the most acute period of the economic crisis appears to be behind us. However, the economic recovery ahead is likely to span years, not months, and hinge on development of a successful vaccine or treatment for COVID-19. Until then, the Southern Nevada economy must navigate the concerns about public health while balancing the needs of regional economic health.