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greater than at a comparable point during the 1981 recession.  There are two reasons that account for this.  First, Nevada’s population and therefore the number of eligible employees who need to be covered by the unemployment system has increased significantly in this time.  The increase in covered employment means that the trust fund must grow accordingly to cover these additional workers.  Second, prices and wages, and by extension, the average unemployment benefit check have increased over this period.  In order to maintain purchasing power to individual households and in the economy at large during a recession, unemployment benefits need to keep pace with this growth, which is why benefits are tied by statute to an individual’s wage and a statewide average wage.  Our next four slides look at the performance of the fund over the last year, compared with the forecasted performance.  This will allow us to analyze the changes in the fund that have occurred over the year.  You can see here that covered employment was lower in 2006 than predicted by 2.5% or 27,000 people.  You can also see that the number of weeks of unemployment insurance benefits claimed was lower than forecasted by $280,000.  Finally, average unemployment was lower than expected by 13.5%, or roughly 7,000 people.  These factors combined led to a stronger than expected performance by the fund over the last year.  This slide shows the historical trend for continued weeks of unemployment benefits claimed.  I would like to highlight just a few things about this slide.  The first is that during a recession, the demand placed on the system increases significantly, nearly doubling in each of the last two recessions.  The second is that Nevada’s labor force is experiencing rapid growth and demands placed on the unemployment system have increased significantly.  Thus, we would expect continued claims to climb over time, especially during times of recession.  Lastly, I’d like to point out changes in recent trend.  You can see that over the last four years, continued claims have fallen significantly. An effect of a quickly expanding economy and extremely tight labor market.  This slide shows us the effect on the fund that recent labor conditions have caused.  In 2006, fund revenues exceeding expectations by 1.9%.  On the other hand, expected benefit payments were lower by 24% and the overall balance of the fund ended $57 million ahead of the forecasted level. The fund benefited from Nevada’s historically low unemployment rates, which hit a low of 3.6% in the first quarter of 2006 and remained low until now.  While achieving this low unemployment, the tight labor market has also affected the length of time unemployment benefits are collected.  To further highlight the strength of the economy, we can take a look at the average duration of unemployment.  Since the beginning of 2004, the average length of time a claimant spent on unemployment has fallen by nearly two weeks.  Not only are less people claiming unemployment, the amount of time spent on unemployment has consistently fallen over the period.  The contributing factors of low unemployment and duration of unemployment has resulted in savings to the fund.  This slide provides us with the state solvency figures as determined per NRS 612.550, Section 7.  These solvency figures represent the needs of the fund based on the system needs over the last ten years.  In the top section of this slide, the requirement for solvency is calculated.  This is done by multiplying current covered employment

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