December 8, 2010:. Manufacturing cities, especially those producing machinery and transportation products, have posted surprising drops in unemployment rates in recent months. This includes devastated cities like Detroit and Elkhart, which continued to experience big job losses early in the year, but which have hit bottom and bounced back of late.
And then there is Nevada. After rising sharply to become the highest in the nation, Nevada’s unemployment rate sank in October. Las Vegas’ did as well. But there’s no good news here; employment was virtually unchanged for the month. Rather, the drop in the unemployment rate was driven by a huge decline in the labour force. Fully 25,000 Nevadans, including 19,000 residents of Las Vegas, left the labour force in October. The Las Vegas labour force has shrunk by 34,000 people in the past year. Migration is a healthy part of adjustment to downturns. The downside here is that shrinkage in Las Vegas’ population will exacerbate the ongoing housing market implosion, leaving households now 50% underwater in ever worse shape.