In Las Vegas, the December unemployment rate was 5.6 percent, up from 5.3 percent in November, and far more than the 4.2 percent rate in December 2006.

Reno area unemployment in December was 5.4 percent, up from 4.8 percent in November and a 3.9 percent rate in December 2006.

State economist Jim Shabi said there is uncertainty among economists on when the economy will recover, but most do not see much change before the second half of the year.

"Everything is escalating right now," he said. "The economy is slowing everywhere, and that makes business very cautious. But people are still moving to Nevada and finding it is not easy to find jobs."

Although the opening of the Palazzo in Las Vegas will add 4,000 jobs, Shabi said that won't make much of a dent in a state with a 1.3 million person work force.

The construction industry in Nevada lost nearly 8,000 jobs in 2007, while employment in the financial industry was down by 1,500 jobs and the temporary job services sector lost 8,200 jobs.

"The housing slump very likely contributed to the weakness in those industries as well," said Bill Anderson, the department's chief economist.

Although retail sales figures for the Christmas season are not available, the boost in retail trade employment was below past years, he added.

Anderson said the workforce in Nevada has climbed by 25,000 people since June, but the number of unemployed grew by 14,000.

The economy still is producing jobs, but only slightly. Just 8,400 new jobs were added in the past year, for a job creation rate of 0.6 percent.

Nevada traditionally has led the nation in job growth, with averages often topping 5 percent.

In the latest unemployment report, the state released information for the October through December quarter that shows the lowest county unemployment now is in gold mining areas. The Nevada mining industry is booming.

Elko County unemployment was just 3.6 percent for the quarter, while Lander County is at 3.8 percent. Nye County has the highest unemployment at 7.2 percent.

Contact reporter Ed Vogel at evogel@ reviewjournal.com or (775) 687-3901. The Associated Press contributed to this report.