By Jennifer Rachel Baumer, Nevada Business Magazine, March 1, 2024
One thing employers in every industry have in common right now: The inability to find employees. Nevada leads the nation with the highest unemployment numbers as of December 2023, but it’s a job seeker’s market.
“Nevada is in a very unique position,” said Christopher Sewell, director, Nevada Department of Employment, Training and Rehabilitation (DETR). “We have the highest unemployment rate in the nation, 5.4 percent, but we also have a lot of individuals that are coming back into the workforce. We have more people in the workforce in the state of Nevada than we’ve ever had before, so we’re in a really unique position of yes, we have the highest unemployment rate, but we also have a labor participation rate that’s increasing. We’re seeing more and more people coming back into the labor market.”
In part, the high unemployment rate is because not every person who’s unemployed in Nevada is looking for a job. Those people who want to work are working, and there’s not enough workforce to fill all the jobs available. Employers are increasingly turning to alternate labor pools and hiring practices. They’re scrambling for enticements to interest potential workers, looking for ways to make them stay and luring them from the competition.
“Nationwide, there are more jobs open than people available applying for the jobs. Even though we are heavy into alternative labor pools and other economies are trying very hard to compete, in this economy there’s plenty of opportunities for the re-entry population. [For example, those] exiting the penal system who want a second chance for supporting their families, for the people with disabilities—now is probably the best time to compete in the labor market,” said Jaime Cruz, executive director, Workforce Connections.
Thoran Towler, CEO, Nevada Association of Employers (NAE) added, “Employers are calling a lot more often, saying, ‘Hey, we need some assistance, how are we going to find people for the positions we have?’
And the big thing is it’s not just entry-level jobs, like service industry jobs, Nevada is well known for. Our members are having challenges filling professional roles, engineering type roles, especially with manufacturing jobs increasing statewide, in northern Nevada especially, but also in southern Nevada. That’s the big challenge: finding people to fill positions.”
NAE works with employers providing HR services, and what they’re seeing is employers seeking employees.
Dating Game
The system of matching people with positions changes when there’s far more open positions than people to fill them, or even people interested in filling them. Businesses are looking at candidates from nearby states, especially California.
“Historically when employers put out a job opening for a position in Reno or Vegas, they didn’t want to interview people who didn’t have a corresponding address or phone number,” said Towler.
That’s gone out the window. Californians looking to fill a position in Reno? Fine. Are they looking to relocate or for remote work? Let’s see what we can make work.
Old School
As employers look for workers, educational requirements for jobs are being softened. Where a job posting might once have required 10 years experience at high levels and a bachelor’s degree, a lot of Nevada employers are choosing to soften those requirements and look at prior experience, personality traits and critical skills.
“Rather than requirements that we have to have before we let someone into the applicant pool, maybe we look at the whole person and we look how long they’ve worked at a job, what kind of experience they have, the variety of different positions they’ve held,” said Towler.
Relaxing education requirements won’t work for every position. Professional positions that require specialized training or education and a state license like engineering, law or nursing, can’t relax requirements. But employer mentality is changing as the labor pool becomes more shallow. Employers are looking to find the right skills rather than the exact right person. They’re taking a harder look at those high school graduates who studied subjects with skills related to those required for the position, like an engineering position candidate with high school STEM classes, and considering sending them to external training classes, apprenticeship programs, or on-the-job training.
On-the-job training programs, apprenticeships and mentor training opportunities are reminiscent of the ’50s, ’60s and ’70s.
“Back in those days you would be trained on the job and would work your way up through that same company, and often retire from the company you first went to work for in high school. That matches what my clients — Nevada businesses — are saying they want. They don’t want turnover rates,” said Towler. “For a long time people would say those days are over, graduate from high school, be trained on the job, stick with the company and be given a gold watch at retirement. Now people jump around all the time. But it will be interesting to see long term if we’re going to make that shift back to where you stay at the same company for your entire career, or maybe move once or twice instead of every couple years that’s been the norm for the last several years.”
One indicator that more young adults may be making the choice to go from high school to work is a national 9 percent drop in high school graduates heading to college.
On the Job Perks
When businesses do find a candidate to fill an open position, the next challenge is keeping them.
“Retention is a really huge challenge for businesses right now,” said Sewell. When working with employers, DETR urges them to look at whether employees the business is trying to keep are getting the proper training. Are wages competitive? Are health insurance packages competitive?
“Retention is a big concern,” agreed Towler. “Because you put all this effort into a person, you hire someone just out of high school, put them through on-the-job training program, and they might leave for a dollar more an hour to one of your competitors.”
Retention has always been a concern for businesses that invest money in training employees. Now it’s especially important. For employers who want to upskill or reskill their employees rather than losing them, DETR can help. “We have a program through Coursera where employees can go online through DETR and get self-based training,” said Sewell. Job seekers can use the program and print proof of the courses they’ve taken when they’re applying for a new job.
DETR also maintains EmployNV Career Hubs. “We have programs not only for employees to upskill themselves, but we have upskilling programs for employers who might say ‘We’ve got some great people, I want to upskill them, I don’t want to lose them,’ so we might be able to help employers with job training and promote those employees. Then we can turn around and help employers fill that gap where those employees came from,” said Sewell.
“There are always people, especially now, who have rethought how and where they want to work,” said Cruz. “For some people that means just switching from office to remote or hybrid, but in some cases it means changing occupations or industries as a whole, and that leads to reskilling.”
One way for employers to hold on to employees is to let them go, just a little bit. When the pandemic lockdown began in the spring of 2020, a lot of employers discovered just how fast they could make the leap to work from home options. It was that, or stop working altogether. Now, a good many employers are trying to insist employees return to the office, and many of the employees aren’t interested.
“I think for many people there’s an expectation that they don’t need to work out of an office. We see many employees in all different industries thinking that if they have to come into the office more than a couple days a week, it’s not the right job for them, said Mark Ricciardi, attorney, Fisher & Phillips.
Discovering how fast and well business learned to function with remote work sent ripples through industries. “Right now we have cities like New York that have millions of square feet of commercial buildings not occupied,” said Cruz. As loans come due and owners can’t pay, many are defaulting on loans; others are converting commercial buildings into residential. Cruz added, “So the pandemic which brought us the issue of hybrid work is having ripple effects all over the place including the available talent where people are saying ‘I want a hybrid job, I’m only going to work for somebody who will allow me to work from home.’”
Some employers can handle remote work employees, depending on both what the industry is and what the individual job is. But in many instances, employers are finding remote employees aren’t collaborating.
“There’s no cross pollination. There’s not the same sense of teamwork. And in terms of anybody who is a junior employee or someone still learning the ropes, not to have hands-on, in-person mentoring and training is very, very difficult,” said Ricciardi. “It’s not the right way to grow a career. We simply hope that employees that are new to the industry or new to the business understand that and are willing to actually come to work.”
Employers are trying a variety of incentives to get people into the office, from buffets to meditation rooms to ping-pong tables. Sometimes it works and sometimes it doesn’t. “It’s just really has to be a top-down expectation that we still run a business, we still run a business out of a particular location, and we expect to see people there at least part of the time. Some companies are really more flexible as to how many days of the week; others simply want people at work,” said Ricciardi.
That said, Friday pizza parties aren’t cutting it anymore. Employers are looking at innovative solutions like confidential employee engagement surveys, directly asking employees what they like and what might induce them to stay.
“One employer found out a lot of their employees wanted a more robust 401K program,” said Towler. “That really surprised the employer who thought nobody cared about that, but employees said they would be happier if there was a better match contribution. The employer did that and their turnover decreased.”
New Regulations for Union Organizing
Employers should understand there have been significant changes to the rules regulating how unions can become representatives of a business’s employees.
“In the past, even the fairly recent past, as far back as last year, a union would have to gather interest cards or a petition from at least 30 percent of employees in an appropriate market union, then petition the NLRB (National Labor Relations Board) for an election,” said Ricciardi.
That changed in August 2023, when the NLRB issued a new decision that basically stated a union can collect interest cards or petition and once it has achieved 50 percent plus 1 of the signatures of the bargaining unit, can simply demand recognition from the employer. “At which point they say, ‘Okay, employer, we represent the majority of your employees; why don’t you just sit down and bargain with us and recognize us as your employees’ representative,’” said Ricciardi.
The employer can refuse, but if they do they then must file within 14 days for an election with the NLRB. “What the NLRB did on top of that was say, ‘Oh, by the way, in the run up to the election, if the employer does anything that violates labor law in terms of what it says or does to the employees, then that violation—and it could be a trivial one—will simply wipe out the election and the NLRB will simply order the employer to bargain with the union,” said Ricciardi.
It’s complicated, but the bottom line, Ricciardi said, is it’s now going to be incredibly easy for some unions to organize almost any business in the country. That’s expected to put a lot of companies at risk.
“But looking, maybe, at the positive side, once the word gets out I think it will cause many employers to start thinking much more carefully about how they treat their employees. Are they paying competitive wages? Are their benefits competitive? Are they treating their employees like part of the team, are they keeping them in the loop with what’s going on in the company? Are they being compassionate? Are they being fair with discipline and promotions? All of those are very positive changes we think employers will make once they’re savvy and in an effort to short circuit potential union organizers,” said Ricciardi.
By the Numbers
April 2020 Nevada’s COVID-19 unemployment rate peaked at more than 30 percent, bouncing between 29.4 and 31 percent. December 2023 the rate was 5.4 percent; still first in the country but significantly recovered.
The second and third highest unemployment rates December 2023 are District of Columbia and California, with rates of 5.1 percent. The lowest rates nationwide were at 2 percent. Those numbers are subject to change as Bureau of Labor Statistics evaluates all of 2023.
Data on people hired into jobs in Nevada from other states indicates numbers are driven by geographic proximity and the size of the originating state. In Q4 2022, the top five states feeding workers into Nevada were:
California – 6,000
Texas – 1,100
Arizona – close to 1,100
Florida – 780
Utah – 770
During the Great Recession Nevada lost 100,000 construction jobs, two-thirds of that industry. It took 10 years to recover to the pre-recession employment level.
“That was about 200,000 jobs, a ballpark estimate in terms of impact to the economy,” said David Schmidt, chief economist, DETR.
The COVID recession lost 350,000 jobs in two months. One-and-a-half times the impact of the Great Recession in two months.
It took two years to go from peak to trough in the Great Recession before we started to gain jobs back, said Schmidt.
The COVID recession was two months down and then jobs began returning rapidly. When jobs returned to pre-pandemic levels growth continued at an average rage of more than 4 percent since regaining lost jobs, despite having 20,000 fewer jobs in the hotel casino industry.
It’s not just casino jobs coming back, it’s growth in manufacturing, professional business services, transportation, warehousing and logistics, wholesale trade and healthcare services, areas driving growth and diversification in Nevada’s economy. “Fast diversification is what you get when COVID shuts down casinos,” said Schmidt.
Focus on Industry
The inability to find workers to fill open positions is a nationwide problem. “I don’t think there is a place where every job that is open is filled,” said Cruz. “It’s tough right now first and foremost to find talent.”
Workforce Connections convened employers from southern Nevada’s seven target industries to look at developing and providing a qualified workforce for them. The initiative for helping employers address challenges related to finding employees is the Industry Sector Partnerships.
The seven focus industries include:
- Healthcare
- General and advanced manufacturing
- Information and communication technologies
- Transportation and logistics technologies
- Clean technologies
- Business and financial services
- Creative industries
Partners working with employers include:
- Las Vegas Global Economic Alliance
- Workforce Connections
- Vegas Chamber
- Clark County School District
- College of Southern Nevada
- UNLV
- DETR
The initiative uses a nationally recognized model, Next Generation (NextGen) Sector Partnerships which establishes industry-led, community supported partnerships to connect workers to jobs and strengthen regional economies.