Friday, October 22, 2010
Nevada unemployment still high
Unemployment in the Silver State remains at a nationwide high of 14.4 percent. Unemployment in Las Vegas has increased from 14.8 percent to 15 percent. Reno unemployment increased from 13.3 to 13.6 percent. Nevada has not seen a real decline in unemployment rates since December of 2005! Nevada has seen double digit unemployment since February 2009.
The labor force reached its peak in March of 2008, just a few months into the official recession. Since then the labor force has declined 9.7 percent while unemployment increased 167 percent.
The problem, in part, is Nevada's high taxes. The Modified Business Tax, which Jon Ralston ridicules as being very small (just 1.2 cents out of ever dollar paid to each employee), but it adds up to $385 million in lost wages and job opportunities.
Taking money out of productive wealth producing enterprises to prop up the boom and bubble era budgets of inefficient and bloated government bureaucracies destroys wealth and jobs in Nevada.
If state agencies have their way, Nevada will need to increase taxes 59 percent - about 50 percent more than the last two tax hikes combined. If Governor Gibbons gets his 10 percent reduction on the 30 percent general fund increase then we will need a 38 percent increase in tax hikes - still larger than the last two tax hikes combined.
If Nevada goes after more tax hikes rather than making REAL cuts in the budget (like rolling back to pre-recession pre-bubble years) then I suspect unemployment might linger at high levels for a long time in Nevada.