Institute for Economic Advancement

Arkansas GDP – 2016:Q2

By , December 7, 2016 4:51 PM

The Bureau of Economic Analysis announced this morning that Arkansas’ Gross Domestic Product (GDP) increased at a seasonally adjusted annual rate of 1.6% in the second quarter of 2016, following a revised growth rate of 4.4% in the first quarter.  Arkansas growth for the quarter exceeded the national average of 1.2%.  Compared to a year earlier, state GDP was up 2.4%.

Source: Bureau of Economic Analysis, Gross Domestic Product by State

Source: Bureau of Economic Analysis, Gross Domestic Product by State

As was the case in the first quarter, Arkansas’ growth rate was boosted by a substantial increase in the category of Agriculture, forestry, fishing and hunting.  Other sectors showing strong growth included Transportation and warehousing, Management of companies and enterprises, and Utilities.  Reflecting continued weakness in natural gas prices, output in the mining sector was once again down sharply.  Other sectors contracting in the second quarter included Construction; Educational services; and Arts, entertainment, and recreation.

Source: Bureau of Economic Analysis, Gross Domestic Product by State

Source: Bureau of Economic Analysis, Gross Domestic Product by State

Today’s news release also included revisions to previously published data.  The revised figures show slower growth in Arkansas over the past two years.  On a fourth-quarter over fourth-quarter basis, Arkansas GDP growth was revised from 2.5% to 2.3% for 2014, and revised from 1.4% to 0.0% for 2015.

Source: Bureau of Economic Analysis, Quarterly GDP by State

Source: Bureau of Economic Analysis,Gross Domestic Product by State

Over the seven year period from the trough of the recession (2009:Q2) through the second quarter of 2016, Arkansas GDP growth has averaged 1.9%.

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Metro Area Employment and Unemployment – October 2016

By , December 1, 2016 12:05 PM

Differences in unemployment rates among Arkansas’ metropolitan areas generally narrowed slightly in October.  In the areas with the unemployment rates below the statewide average of 4.0% (Fayetteville, Jonesboro, and Little Rock), rates were unchanged.  Unemployment rates were down 0.3 percentage points in Pine Bluff and Fort Smith, and down 0.2 percentage points in Texarkana.  In Hot Springs, where the unemployment rate remains slightly above the statewide average, the unemployment rate ticked down by 0.1.  Memphis was the exception to the pattern, where a 0.1 percentage point increase in unemployment increased the rate to the highest among all metro areas that include parts of Arkansas.

Source: Bureau of Labor Statistics, Seasonally Adjusted Metropolitan Area Estimates

Source: Bureau of Labor Statistics, Seasonally Adjusted Metropolitan Area Estimates

Unemployment rates remained lower than a year earlier in all eight of the metro areas.  The largest decline was in Pine Bluff — down 1.6 percentage points (not seasonally adjusted data).  The unemployment rate in Texarkana rose 0.5 percentage points since May, but was 0.1 percentage point lower than in October 2015.

Source: Bureau of Labor Statistics, Seasonally Adjusted Metropolitan Area Estimates

Source: Bureau of Labor Statistics, Seasonally Adjusted Metropolitan Area Estimates

Payroll Employment
Data on nonfarm payroll employment was mixed.  Employment was higher in Memphis, Fort Smith and Little Rock, but declined in Jonesboro, Hot Springs and Pine Bluff.  There was no change in Fayetteville and Texarkana.

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

Over the most recent 12 months, employment has increase in all metro areas except Pine Bluff and Texarkana.  Those are also the only two metro areas where employment has declined, on net, since the nationwide and statewide employment trough-date of February 2010.

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Arkansas Taxable Sales – 2016:Q3

By , November 22, 2016 11:13 AM

After declining during the first half of the year, Arkansas Taxable Sales (ATS) rose 2.2% in the third quarter of 2016.  On a year-over-year basis, taxable sales were up 1.3% from the third quarter of 2015.  Gasoline sales also rose in the third quarter (+1.6%), despite a slight reduction in the average price of gasoline in Arkansas.  As a result, Arkansas Taxable Sales Including Gasoline (ATSIG) also rose by 2.2% from the second quarter to the third.  Over the past four quarters, ATSIG has increased by 0.6% while gasoline prices have fallen from $2.28/gallon in 2015:Q3 to $1.985 in the most recent quarter.

Sources:  Arkansas Department of Finance and Administration, Oil Price Information Service, Institute for Economic Advancement

Sources: Arkansas Department of Finance and Administration, Oil Price Information Service, Institute for Economic Advancement

Sources: Arkansas Department of Finance and Administration, Oil Price Information Service, Institute for Economic Advancement

Sources: Arkansas Department of Finance and Administration, Oil Price Information Service, Institute for Economic Advancement

From the trough of the recession (2009:Q2) through the third quarter of 2016, ATS has grown at an average rate of 3.0%.  With gasoline expenditures falling at a 2.1% annual rate over the same period, ATSIG has increased at a 2.8% rate.  As measured by the price index for personal consumption expenditures, inflation has averaged 1.5% over the 7-year expansion, so that real (inflation adjusted) measures of ATS and ATSIG have grown at rates of 1.5% and 1.3%, respectively.

As shown in the final figure below, gasoline prices are at about the same level as at the trough of the recession–around $2/gallon.  However, spending on gasoline as a percent of total taxable sales has fallen to less than 5%, down from around 6% in 2009.  Although expenditures on gasoline have increased over the past 7 years, lower gas prices have allowed for spending on non-fuel items to increase as a share of total expenditures.

Sources: Arkansas Department of Finance and Administration, Oil Price Information Service, Institute for Economic Advancement

# # #

Arkansas Taxable Sales (ATS) is calculated by the Institute for Economic Advancement to serve as a timely proxy for Arkansas retail sales. The series is derived from sales and use tax data, adjusting for the relative timing of tax collections and underlying sales, changes in tax laws, and seasonal patterns in the data.  Arkansas Taxable Sales Including Gasoline (ATSIG) incorporates data on the state motor fuel tax and gasoline prices from the Oil Price Information Service. A spreadsheet of the monthly and quarterly data is available here: Arkansas Taxable Sales 2016:Q1 (Excel file).

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Arkansas Employment and Unemployment – October 2016

By , November 18, 2016 1:50 PM

Arkansas’ unemployment rate remained unchanged at 4.0% in October.   The underlying data from the household survey shows that the number of employed Arkansans declined for the 5th consecutive month, falling by 1,805.  The number of unemployed fell slightly (-368) after rising in the previous four months.

Source: Bureau of Labor Statistics, Local Area Unemployment Statistics (LAUS)

Source: Bureau of Labor Statistics, Local Area Unemployment Statistics (LAUS)

Payroll Employment
Arkansas nonfarm payroll employment increased by 300 in October (seasonally adjusted).  An increase of 1,700 jobs in Construction employment accounted for a net increase in goods-producing sectors.  Despite a strong increase in Professional and Business Services (+1,700), service-providing sectors contracted from September to Octobers, led by declines in Leisure and Hospitality (-700), Wholesale Trade (-500) and Retail Trade (-1,600).  The concentration of job losses in consumer-related sectors suggests that firms are not scaling up holiday employment as much as in previous years.

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

As presented during our Arkansas Economic Forecast Presentation, information from the Quarterly Census of Employment and Wages suggests that the nonfarm payroll data will ultimately be revised downward for the period from 2014:Q2 through 2015:Q1.  Final revisions will not be completed until March 2017 and will include additional data from 2015.   Currently, the total magnitude of the revision is estimated to be approximately 4,800 jobs (about 0.4%), with the revisions concentrated in the second half of 2015.

Sources: Bureau of Labor Statistics, Institute for Economic Advancement

Sources: Bureau of Labor Statistics and the Institute for Economic Advancement

The table below breaks down the expected revisions by sector.  Employment in goods producing sectors is expected to be revised upward, while service-sector job growth will generally be revised lower (with the exception of Financial Services).  Overall job growth for the period December 2014 through October 2016 is presently estimated to be 31,200 (2.6%), but our projections of future data revisions indicate that growth rate for that period will total 26,400 jobs (2.2%).

Sources: Bureau of Labor Statistics, Institute for Economic Advancement

Sources: Bureau of Labor Statistics and the Institute for Economic Advancement

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Arkansas Economic Forecast Presentation

By , November 16, 2016 2:06 PM

Little Rock Regional Economic Briefing

Thank you to all who attended this morning’s Regional Economic Briefing, where I presented my annual forecast for the Arkansas economy.  Special thanks to the Little Rock Branch of the Federal Reserve Bank of St. Louis for co-sponsoring the event.

Below are links to the presentations:

Kevin Kliesen:  National Economic Conditions

Charles Gascon:   Startups, STEM Jobs and the Tech Sector

Michael Pakko:  The Arkansas Economic Outlook

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Arkansas Home Sales – September 2016

By , November 11, 2016 3:19 PM

According to newly released data from the Arkansas Realtors® Association, home sales across the state totaled 3,010 in September — up 6.5% from September of 2015.  This increase comes on the heels of a year-over-year increase of 15.2% in August.

Source:  Arkansas Realtors® Association

Source: Arkansas Realtors® Association

With the peak summer months now behind us, it is now inevitable that home sales growth will be significantly positive for the fourth consecutive year.  For the first three quarters of 2016, home sales 6.5% higher than the same period a year earlier.  As shown in the figure below, seasonally-adjusted home sales have been following a clear upward trend since late 2012, and are on track to make 2016 the highest sales volume since before the housing market collapse in 2007.

Source:  Arkansas Realtors® Association; Seasonally adjusted by the Institute for Economic Advancement

Source: Arkansas Realtors® Association; Seasonally adjusted by the Institute for Economic Advancement

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2016 Arkansas Economic Forecast Presentation

By , November 7, 2016 4:31 PM

Dr. Michael Pakko will present his annual forecast for the state’s economy on the morning of Wednesday, November 16 at a Little Rock Regional Economic Briefing, hosted jointly by The Little Rock Branch of the Federal Reserve Bank of St. Louis and the Institute for Economic Advancement at the University of Arkansas at Little Rock

The briefing will include:

  • Kevin Kliesen, St. Louis Fed research officer and business economist, will discuss national conditions.
  • Charles Gascon, St. Louis Fed regional economist, will give an overview of the state of the Arkansas economy.
  • Michael Pakko, chief economist and state economic forecaster with the institute, will provide the Arkansas forecast.
Date:  Wednesday, Nov. 16, 2016
Time:  7:30-8 a.m. | Breakfast
8-9:45 a.m. | Program
Location: Clinton Presidential Center
Great Hall
1200 President Clinton Ave.
Little Rock, Ark. 72201

Registration is free; however, registration is required by Friday November 11.
Register here:  https://www.stlouisfed.org/events/2016/11/LRK-REB1116

Little Rock Regional Economic Briefing

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Metro Area Employment and Unemployment – September 2016

By , November 2, 2016 3:40 PM

Unemployment rates increased in all of Arkansas’ metropolitan areas in September.  Seasonally adjusted estimates showed increases of 0.2 percentage points in six of Arkansas’ metro areas, with the rate increasing by 0.3 in Pine Bluff and only 0.1 in Texarkana.  The statewide unemployment rate rose by 0.1 percentage points for the month.

Source: Bureau of Labor Statistics, Smoothed Seasonally Adjusted Metropolitan Area Estimates

Source: Bureau of Labor Statistics, Smoothed Seasonally Adjusted Metropolitan Area Estimates

Unemployment rates remain consistently lower than a year ago, but have given up some of the gains achieved during the summer and are presently at levels comparable to the early months of 2016.

Source:  Bureau of Labor Statistics, Seasonally Adjusted Metropolitan Area Estimates

Source: Bureau of Labor Statistics, Seasonally Adjusted Metropolitan Area Estimates

Payroll Employment
Changes in Nonfarm Payroll Employment in September were mixed.  Hot Springs and Jonesboro both showed solid employment gains for the month.  However, employment was down in Fayetteville, Little Rock, Memphis and Pine Bluff.  Employment was essentially unchanged in Fort Smith and Texarkana.

Source: Bureau of Labor Statistics, Current Employment Statistics

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

Over the past 12 months, employment has increased across most of the state, but has declined in Pine Bluff and Texarkana.  Employment has been slow to recover from the 2008-09 recession in many parts of Arkansas.  Only Fayetteville and Jonesboro have shown significant employment increases since December 2007, with the Little Rock metro area up slightly compared to pre-recession levels.  Employment in Pine Bluff is down by 13% from 2007, having fallen 10.5% since employment in other parts of the state reached post-recession lows.

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

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Arkansas Employment and Unemployment – September 2016

By , October 21, 2016 4:43 PM

The September report on state-level employment and unemployment showed that the Arkansas unemployment rate increased by 0.1 percentage points to 4.0%.  The national unemployment rate was 5.0% in September, also up 0.1 percentage points.

Source:  Bureau of Labor Statistics

Source: Bureau of Labor Statistics

The September report on household employment and unemployment represented a continuation of the trends that emerged over the summer. The number of unemployed Arkansans was up 1,513 and the number of employed was down by 541.  September was the fourth consecutive month in which unemployment increased and employment declined.

Source:  Bureau of Labor Statistics, Local Area Unemployment Statistics (LAUS)

Source: Bureau of Labor Statistics, Local Area Unemployment Statistics (LAUS)

Payroll Employment
Arkansas nonfarm payroll employment increased by 3,300 in September (seasonally adjusted*).   Employment in Education & Health Services accounted for much of the gain, increasing by 2,300 jobs.   Manufacturing employment registered an increase of 1,200, but was still down by 300 jobs compared to a year ago.  In fact, employment has declined over the past 12 months in each of the major goods-producing sectors (Mining & Logging, Construction, and Manufacturing), while increasing in every service-providing super-sector.

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

Relative to pre-recession levels, total payroll employment in Arkansas has increased by 25,200 — a gain of about 2.1%.  Over the same period, nationwide employment has increased by 4.6%.   Payroll employment expanded by more than 2% in both 2014 and 2015, but has slowed in 2016:  From December 2015 through September 2016, Arkansas employment is up by only 5,800, or 0.5%.

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

 # # #

*Seasonally adjusted data for Arkansas nonfarm payroll employment, reported in a format compatible with the monthly news release from the Arkansas Department of Workforce Services, can be found hereTable-Seasonally Adjusted NFPE.

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Metro Area Employment and Unemployment – August 2016

By , September 30, 2016 3:53 PM

New data on employment and unemployment in metro areas came out earlier this week.  The data continue to show substantially lower unemployment rates in most Arkansas metro areas than a year earlier, although most of the decline took place in the latter part of 2015 with monthly data showing rates leveling off more recently.  In Texarkana, the unemployment rate has been drifting higher in recent months, leaving a net change of zero compared to August 2016.

Source: Bureau of Labor Statistics, Local Area Unemployment Statistics (LAUS)

Source: Bureau of Labor Statistics, Local Area Unemployment Statistics (LAUS)

From July to August, seasonally adjusted estimates show no change in unemployment rates in most metro areas.  Unemployment rates in Fayetteville and Texarkana crept upward by one-tenth of a percentage point, while Hot Springs saw its unemployment rate decline by one-tenth.  The unemployment rate in Pine Bluff increased by two-tenths of a percent.

Source: Bureau of Labor Statistics, Seasonally Adjusted Metropolitan Area Estimates

Source: Bureau of Labor Statistics, Seasonally Adjusted Metropolitan Area Estimates

As shown in the figure below, unemployment rates in Arkansas have leveled off since spring, and in some cases have increased through the summer.  Considerable variation remains among metro area rates, with unemployment under 3% in Fayetteville and over 5% in Memphis and Pine Bluff.

Source: Bureau of Labor Statistics, Seasonally Adjusted Metropolitan Area Estimates

Source: Bureau of Labor Statistics, Seasonally Adjusted Metropolitan Area Estimates

Payroll Employment
Estimates of nonfarm payroll employment in August were mixed.  From July to August, employment declined in Fayetteville and Pine Bluff, while increasing in Fort Smith, Little Rock, and Memphis.  Compared to a year earlier, only Pine Bluff shows a net decline in employment.  Since the employment trough of February 2010, the data show strong job growth in the Northwest and Northeast regions of the state, with more modest growth in other metro areas.  The exception is Pine Bluff, where employment has continued to decline.

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

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