LAS VEGAS -- The Brookings Institution reported Tuesday night that the Las Vegas metropolitan area continues to suffer from one of the nation's least resilient and weakest labor markets.
The public policy think tank in Washington, D.C., based those conclusions on industry job growth, housing prices, and the gap between the education required to fill job vacancies and the education attained by the average working-age person in the metro area.
Brookings used those factors to measure the nation's 100 largest metros in two categories: the resiliency of their labor market based on changes in the unemployment rate since the recession began; and the strength of their labor market based on the level of unemployment.
In both cases Las Vegas placed eighth from the bottom. California metros have the six least resilient labor markets and five of the six weakest ones, with Modesto landing on the bottom of both lists. Pittsburgh has the nation's most resilient labor market and Rochester, N.Y., has the nation's strongest one.
Las Vegas scored as poorly as it did because its housing prices dropped 60 percent from 2006 through the first quarter of 2012, its predicted industry job growth based on a Brookings formula was only 2.8 percent from the first quarter of 2010 to the first three months of this year, and its average education gap over the past two years -- also based on a formula -- was 8 percent.
Pittsburgh's predicted industry job growth, a measurement of how its employment level would change if its industries grew at the national average for those industries, was only slightly better than that of Las Vegas. But Pittsburgh's housing prices rose 7.3 percent and its education gap was only 3.1 percent, meaning the education level of its labor force more closely matched the requirements of available jobs than was true in Las Vegas. Rochester experienced a 4 percent gain in housing prices and had an education gap of only 1.6 percent.
Las Vegas also saw its unemployment rate climb by 7.6 percentage points from pre-recession lows through May, when it reached 11.8 percent. That contrasted with the 2.3-point increase in Pittsburgh and the 3.4-point hike in Rochester.
Among the metros, Las Vegas ranked 18th in the demand for its industry products, but also placed 90th for its education gap and last for housing price growth.
Brookings found that 43 percent of the job openings in the largest metros require at least a bachelor's degree, but only 32 percent of adults 25 and older have earned one. In Las Vegas 37.6 percent of the job openings as of January and February required at least a bachelor's degree but only 21.6 percent of the adults in the labor force earned one. Some 34.3 percent of the jobs required at least some college or an associate's degree, and 32.4 percent of adults fell into that category.
Only 28.1 percent of the available jobs required no more than a high school diploma, but 46 percent of Las Vegas adults would have been eligible for that work.
The think tank concluded that unemployment rates are higher in those cities where there is a shortage of educated workers relative to demand, and that metro areas with higher education gaps have created fewer jobs in recent years.
But Brookings stated that there is no correlation between a metro area's education gap and the percentage of job openings that go unfilled. Las Vegas tied for fourth best in the nation with only 27 percent of its job openings this year going unfilled after at least a month. The think tank stated that metro areas with the most educated labor forces tend to have a larger share of jobs in science-related fields that take longer to fill. Many of the cities that have the highest percentage of jobs that go unfilled after a month actually have among the nation's lowest unemployment rates.
"In the short term, unemployment rates are unlikely to come down to their pre-recession levels without improvements in housing markets and consumer demand," wrote the report's author, Brookings senior research associate Jonathan Rothwell. "Yet high educational attainment is essential for the health of metropolitan labor markets before, during and after recessions.
"Educational attainment makes workers more employable, creates demand for complementary less educated workers and facilitates entrepreneurship. To better train less educated adults, non-profit organizations, community colleges and governments can use detailed job openings data to align training curricula and certifiable skills with employer demand."