Arkansas Economic Development Institute

Arkansas Employment and Unemployment – October 2017

By , November 17, 2017 12:38 PM

The latest report on state-level employment and unemployment contained mixed signals on the state of Arkansas labor markets.  The household survey presented a relatively weak picture:  For the third consecutive month, the number of unemployed Arkansans increased, causing the unemployment rate to tick up by one-tenth of a percentage point (to 3.6%).  The associated household employment figures showed a decline in both the number employed (-1,870) andthe size of the labor force (-1,191).

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

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

Even with the slight uptick, the unemployment rate remains exceptionally low.  The national unemployment rate dropped by one-tenth of a percent in October, to 4.1%. Hence, the rate in Arkansas remains one-half of a percentage point lower than the U.S.

Source: Bureau of Labor Statistics

Source: Bureau of Labor Statistics

Payroll Employment
The report on payroll employment was more favorable overall, but it also contained hints of weakness for some sectors.  From September to October, total nonfarm payroll employment increased by 3,100.  Employment growth from the previous month was also revised higher:  Originally reported as +1,100 the August-September change was revised up to +1,600.  Over the past 12 months, payrolls have expanded by 23,500 – an increase of 1.9%.  Over the same 12-month period, nationwide payroll employment grew by 1.3%.

Source: Bureau of Labor Statistics

Source: Bureau of Labor Statistics

Goods-producing sectors continued to show job gains in October:  Employment in Construction rose by 800 jobs and Manufacturing was up by 1,000.  For Manufacturing, October represented the fifth consecutive monthly gain.  In contrast, some service-providing sectors continued to show uncharacteristic weakness.  Financial Services, Education & Health Services, and Leisure and Hospitality Services all showed monthly employment declines.  In the cases of both Education & Health and Leisure & Hospitality, year-over-year changes remain positive but the declines in October represent a third consecutive month of contraction.

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

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

Overall, the longer term trends remain intact:  Manufacturing employment remains nearly 30,000 below the level registered prior to 2008-09 recession, while most job growth has been in service-providing sectors, particularly Professional & Business Services and Education & Health Services.

# # #

 *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 here:  Table-Seasonally Adjusted NFPE.

Print Friendly

Economic Briefing December 1 – The Outlook for Arkansas

By , November 16, 2017 1:40 PM

Little Rock Regional Economic Briefing

DATE:  December ‌1, 2017

LOCATION:  Clinton Presidential Center Great Hall (map it)

REGISTER HERE

Join us as St. Louis Fed President James Bullard and Michael Pakko of the Arkansas Economic Development Institute give updates on economic conditions and the outlook for the state and the nation. Dr. Pakko is chief economist and state economic forecaster with the institute. The Little Rock Branch of the Federal Reserve Bank of St. Louis and the institute, which is at the University of Arkansas at Little Rock, are hosting the event. The program also will include:

  • A welcome from Robert Hopkins, senior vice president and regional executive of the Little Rock Branch;
  • Q&A sessions after President Bullard’s and Dr. Pakko’s presentations;
  • Adjourning remarks from James Youngquist, institute executive director.

The program will be of particular interest to business leaders and others who want to keep up on current economic conditions. A hot buffet breakfast will be served. The event is free, but register soon, because space is limited. The deadline is Nov. 28.

Questions? Please contact Julie Kerr at 501-324-8296 or julie.a.kerr@stls.frb.org.

Print Friendly

Metro Area Employment and Unemployment – September 2017

By , November 1, 2017 4:52 PM

Unemployment rates in Arkansas metro areas continue to show year-over-year reductions, with the decline in rates ranging from 0.3% in Fayetteville to -2.2% in Memphis.  Statewide, the unemployment rate was down 0.5% from a year earlier (not seasonally adjusted).

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

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

Seasonally adjusted estimates for September show that unemployment rate changes from August to September were mixed.  Rates ticked up 0.1% in Little Rock and Pine Bluff, but declined in Fort Smith, Texarkana and Memphis.  The drop in the unemployment rate for Memphis was particularly notable – down 0.4%.

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

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

Payroll Employment
Nonfarm payroll employment showed increases across most of Arkansas’ metro areas, with the exception of Memphis (-0.2%).  Jonesboro (+1.1%), Fort Smith (+0.8%) and Little Rock (+0.6%) were up significantly, with Hot Springs, Pine Bluff and Texarkana also showing increases (all +0.3%).

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

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

Employment growth over the past year has generally been consistent with longer term trends, with Fayetteville and Jonesboro leading the pack.  Hot Springs has experienced above-trend growth over the past 12 months, +2.4%.  Fort Smith, Little Rock and Memphis have all shown relatively small changes in employment, while employment in Pine Bluff and Texarkana continues to decline.

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

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

 

Print Friendly

Arkansas Home Sales – September 2017

By , October 31, 2017 5:29 PM

The latest statistics from the Arkansas Realtors® Association show a small increase in Arkansas home sales in September.  Sales of new and existing homes were 3,103 for the month, up 0.1% compared to the previous year.  For the first 9 months of the year, sales totaled 27,106, up 4.4% compared to same period in 2016.  As shown in the figure below, September marks the start of the end-of-year slowdown in home sales.  If sales during the remaining three months of the year turn out to be unchanged from 2016, the end-of-year cumulative total for 2017 would still be up by over 3%.

Source: Arkansas Realtors® Association

Source: Arkansas Realtors® Association

After seasonal adjusting the data and aggregating from monthly to quarterly data, the underlying trends are more readily observed (see below).  Although the seasonally-adjusted third quarter figure represents a decline from the first half of the year, there is no clear evidence of a persistent slowdown.  Nevertheless, with the sales pace having recovered to pre-2007 levels, it would not be surprising to see some leveling-off of sales growth in the near future.

Source: Arkansas Realtors® Association.  Seasonally adjusted by the Arkansas Economic Development Institute.

Source: Arkansas Realtors® Association. Seasonally adjusted by the Arkansas Economic Development Institute.

 

Print Friendly

Arkansas Employment and Unemployment – September 2017

By , October 20, 2017 12:56 PM

The latest monthly report on employment and unemployment in Arkansas was a fairly strong report.  Both the household and payroll surveys showed employment gains for the month.  And while the number of unemployed was up for a third consecutive month, the unemployment rate was unchanged at the very low level of 3.5%.  The U.S. unemployment rate dropped 0.2% to 4.2% in September, remaining significantly higher than the Arkansas rate.

Source: Bureau of Labor Statistics

Source: Bureau of Labor Statistics

The increase in the number of unemployed over the past three months has totaled about 2,300, but this increase has not significantly affected the unemployment rate, which has held steady as the number of labor market participants has grown proportionately.  Over the past 12 months, the labor force has grown by over 43,000, with most of that increase occurring in the first six months of 2016.  While we expect that figure to be eventually revised downward, the positive momentum is clear.

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

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

Payroll Employment
Data from the establishment survey reinforces the evidence of solid employment growth.  Arkansas nonfarm payroll employment was up 1,100 in September, and the figure for August was revised upward by 1,600 jobs.  September is a month with significant seasonal influences:  The not-seasonally adjusted statistics showed an employment increase of 15,500, but most of those gains were in State and Local government (public schools) and Education Services (private institutions).  The seasonally adjusted figures in the table below adjust for these predictable patterns.  Goods producing sectors performed well in September, with Construction up 1,100 and Manufacturing up 1,300.  The seasonally adjusted statistics actually show a decline in total service-providing employment, with losses particularly evident in Leisure and Hospitality sectors.

AR-NFPE-0917-tab

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

Compared to a September 2016, total nonfarm payroll employment is up 24,400 jobs in Arkansas — a rate of 2.0%.  Over the same period, nationwide employment has expanded by 1.2%.

Source: Bureau of Labor Statistics

Source: Bureau of Labor Statistics

# # #

 *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 here:  Table-Seasonally Adjusted NFPE.

Print Friendly

Personal Consumption Expenditures – 2016

By , October 5, 2017 4:41 PM

The Bureau of Economic Analysis reported yesterday that Personal Consumption Expenditures (PCE) rose by 3.9% in Arkansas in 2016.  Nationwide, the growth rate was 4.0%.  PCE is not adjusted for inflation, so after accounting for a 1.2% increase in prices from 2015 to 2016, Arkansas real PCE increased by about 2.7%.  As shown in the figure below, Arkansas PCE has been increasing at a slower pace than the national averages since 2012.

Source: Bureau of Economic Analysis

Source: Bureau of Economic Analysis

The fastest-growing components of PCE in Arkansas included Health care (+7.0%), Other nondurable goods (+6.8%), and Food services and accommodations (+5.6%).  The only category of spending to decline from 2016 to 2016 was Gasoline and other energy goods, which was affected by declines in gasoline prices.

Source: Bureau of Economic Analysis

Source: Bureau of Economic Analysis

Per Capita PCE
One of the reasons for the slower growth in Arkansas PCE relative to the U.S. average is the relatively slow population growth rate in Arkansas.  Population growth in Arkansas was approximately 0.3% in 2016, while the comparable growth rate for the U.S. population was 0.7%.  Accordingly, on a per capita basis, Arkansas PCE increased by 3.5% in 2016, slightly exceeding the national average growth rate of 3.2%.

The table below displays spending levels and expenditure shares for per capita PCE in 2016.  Overall, per capita spending in Arkansas was $31,117 — 78.5% of the national average.  It is not surprising that spending per capita is relatively low in Arkansas:  income per capita is below the national average and prices also tend to be well below the national average.  Figures from the Regional Price Party data show that prices are approximately 12.6% lower in Arkansas than the national average, with housing costs particularly low — about 36% lower than the national norm.  These price patterns show through to the per capita spending figures, with expenditures on housing nearly 34% lower than the U.S. average.   For two categories of spending, per capita PCE in Arkansas exceeds the national rate:  Motor vehicles and parts, and Gasoline and other energy goods.  At the other extreme, spending on Transportation services amounts to less than one-half of the per capita level nationwide.

Per Cap PCE 2016

Print Friendly

Arkansas Personal Income – 2017:Q2

By , October 3, 2017 5:13 PM

Last week’s news release on personal income included new statistics for the second quarter of 2017, along with data revisions for the period 2014-present.

The latest update showed personal income increasing 0.6% in the second quarter, slightly below the national growth rate of 0.7%.  Data from the first quarter were revised to show an increase of 2.0% for Arkansas, up from the 1.0% rate previously reported.  For the four quarters from 2016:Q2 to 2017:Q2, Arkansas’ growth rate was 3.0%.  For the same period, the nation’s income growth rate was 2.9%.  After adjusting for an inflation rate of 1.6% (as measured by the price index for personal consumption expenditures), the real year-over-year growth rates of personal income for Arkansas and the U.S. were 1.4% and 1.3%, respectively.

Source: Bureau of Economic Analysis

Source: Bureau of Economic Analysis

The breakdown of personal income growth in the second quarter reveals that nonfarm income rose 0.9%, while the more volatile farm income component decreased by 15.2%.  Among the major sources of income, both Dividends, Interest, and Rent and Wage and Salary Disbursements increased 1.2%.  On a year-over-year basis, Arkansas’ 3.0% growth rate reflected a surge in Proprietors’ Income (+7.8%).  Arkansas’ growth rate also outpaced the nation in Earnings by place of work (3.3% compared to 2.9% nationwide).

Source: Bureau of Economic Analysis

Source: Bureau of Economic Analysis

Overall, the annual revisions to the personal income data for 2014-16 raised estimates of Arkansas incomes.  The revisions had the effect of raising total personal income by 1.0% in 2014, by 2.0% in 2015 and by 1.0% in 2016.

Source: Bureau of Economic Analysis

Source: Bureau of Economic Analysis

The bulk of the revisions were attributable to Dividends, Interest and Rent.  Cumulatively, that component was revised upward by 10.7%. Personal Current Transfer Receipts were revised upward for 2016 (by 1.0%), but for all other categories of income (including Wage and Salary Disbursements), the cumulative effect of revisions was negative.

Source: Bureau of Economic Analysis

Source: Bureau of Economic Analysis

We had previously noted that while personal income growth in Arkansas has roughly kept pace with the national average in recent years, its growth has been skewed in favor of the Dividends, Interest and Rent component while Wage and Salary income has grown more slowly than the national average.  The new data revisions exacerbate that differential.  As shown in the table below, Wage and Salary income has accounted for just over one-half of national personal income growth over the course of the economic expansion.  Here in Arkansas, however, Wages and Salaries account for less than 40% of total income growth.   In contrast, Dividends, Interest and Rent accounts for over one-third of Arkansas income growth and only 26% at the national level.  The other component that has been contributing a relatively large share to Arkansas income growth is Personal Current Transfer Receipts.  The growth rates of transfer payments have been roughly the same for Arkansas and the U.S., but that component represents a larger share of total income for Arkansas.

Source: Bureau of Economic Analysis and author's calculations

Source: Bureau of Economic Analysis and author’s calculations

Arkansas per capita personal income in the second quarter was $40,893, representing 81.3% of the national average per capita income of $50,308.  As a percent of the national average, the recent data revisions improved Arkansas standing:  Before the revisions, per capita income stood at 79.4% of the national average (in the first quarter).  It was the cumulative effect of data revisions for 2014-16 that raised estimates for Arkansas back above the 80% line.

Source: Bureau of Economic Analysis

Source: Bureau of Economic Analysis

Print Friendly

Metro Area Employment and Unemployment – August 2017

By , September 28, 2017 5:08 PM

Unemployment rates in Arkansas metro areas remain lower than a year earlier.  Wednesday’s news release from the Bureau of Labor Statistics noted that year-over-year changes in unemployment rates show declines in 323 of the nations 388 metropolitan areas, with all of Arkansas metros included in that total.  Recent monthly changes in unemployment rates have indicated a leveling-off, with most of the declines since August 2016 having taken place in the final months of 2016.

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

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

As previously reported, Arkansas’ statewide unemployment rate ticked up one-tenth of a percentage point in August, with the increase attributable to the first notable increase in the number of unemployed Arkansans since 2011.  Unemployment rates in the state’s metro areas generally followed the same pattern.  An increase in the number of unemployed was reported each of Arkansas’ metro areas except Memphis.  The increases were large enough to push unemployment rates up in Fayetteville, Fort Smith, Jonesboro, Little Rock 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
Nonfarm payroll employment in Arkansas metro areas also followed the statewide pattern of a downturn in August, with payrolls declining in four of the state’s metro areas.  Declines were particularly pronounced in the rapidly growing northwest and northeast corners of the state, where recent employment growth trends have been the highest.  Payroll employment in Fayetteville was down 0.4% from July to August, but remained up 3.0% from a year earlier.  In Jonesboro, the monthly decline registered 0.5%, leaving employment 1.6% above its August 2016 level.

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

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

 

Print Friendly

Metro Area GDP – 2016

By , September 22, 2017 1:23 PM

The Bureau of Economic Analysis released 2016 GDP data for metropolitan areas earlier this week. The data for Arkansas metro areas show relatively strong growth in Fayetteville, Jonesboro, and Texarkana. Real GDP contracted in Fort Smith, Hot Springs and Pine Bluff.

Source:  Bureau of Economic Analysis

Source: Bureau of Economic Analysis

It should be noted that real GDP data are adjusted for the overall rate of inflation.  However, they are not adjusted for changes in population growth.  That is, real GDP growth can be decomposed into two components: growth due to population increase and growth due to the expansion of output per capita. As shown in the table below, the decomposition shows differing characteristics of growth in the various metro areas covering parts of Arkansas. For example, nearly 60% of the GDP growth in the Fayetteville metro area is attributable to population growth, leaving a per capita growth rate of 1.6%. On the other hand, slow population growth in Texarkana means that most of the overall GDP growth in that metro area reflects increases in output per person — at an even faster pace than in Northwest Arkansas!  In Pine Bluff, population is contracting more rapidly than overall GDP growth, implying a positive growth rate per person in spite of the overall negative growth rate.

Sources: Bureau of Economic Analysis, Census Bureau

Sources: Bureau of Economic Analysis, Census Bureau

GDP is intended to measure the entire output of an economy — the sum of all goods and services produced within a particular geographic area.  The calculation of such a comprehensive measure of economic activity is necessarily complex and is often subject to revision as more information becomes available.  Consequently, the initial estimates of 2016 metro area GDP that were released this week are quite likely to be revised in the future.

The data released earlier this week includes revisions to the previously published estimates for 2001-2015.  As illustrated by the set of charts below, the magnitude of these revisions can be substantial. For example, the data that came a year ago showed Hot Springs growth in the range of 3 to 4% in 2012 and 2013. The newly revised and updated figures show growth over the same period to have been negative 3 to 4%.  This is a rather extreme example of the revisions typically observed, but it highlights the uncertainty associated with originally published estimates of metro area GDP statistics.

Source: Bureau of Economic Analysis

Source: Bureau of Economic Analysis

 

Print Friendly

Arkansas Employment and Unemployment – August 2017

By , September 15, 2017 12:40 PM

The August report on employment and unemployment was a bit disappointing in several respects, but the latest month-to-month readings should be considered against a backdrop of positive longer-term trends.  The headline news was an uptick in Arkansas’ unemployment rate, up from 3.4% to 3.5%. The rise was attributable to an increase in the number of unemployed by over 1,200 — the first notable increase in that figure since early 2011.  But with unemployment at historic lows, it is not surprising to see some ups and downs in the monthly data.  The number of employed and the total labor force both increased again in August, albeit at a slower pace than 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)

Compared to August 2016, the unemployment rate was down 0.5% with the number employed up 41,710 and the number of employed down 6,501.  The magnitude of the year-over-year employment gains is likely to be reduced when the data are revised early next year, but the direction of the trend remains clearly positive.

Payroll Employment
The report on nonfarm payroll employment showed a decline of 7,200 jobs in August (seasonally adjusted).  Employment in goods-producing sectors declined slightly from July to August, with construction down by 1,500 and Manufacturing off by 300.  Service-providing industries also shed jobs in August, with declines totaling 5,400 jobs.  Losses were registered in some of the sectors that have been showing the largest gains in recent months, including a downturn in Professional & Business Services (-1,100) and Leisure & Hospitality Services (-600).  Even Health Care and Social Assistance showed a decline of 900 jobs.

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

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

Despite these one-month losses, the trends in payroll employment remain strong.  From August 2016 to August 2017, the net employment increase was 23,400, or 1.9%. The year-over-year increases are attributable to both goods-producing and service-providing sectors, but with the largest gains in the service sectors.  Over the same period, nonfarm payroll employment nationwide increased by 1.5%.

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 here:  Table-Seasonally Adjusted NFPE.

 

Print Friendly

Panorama Theme by Themocracy

AWSOM Powered