Institute for Economic Advancement

Arkansas Employment and Unemployment – August 2014

By , September 19, 2014 10:26 AM

The Arkansas unemployment rate ticked up one-tenth of a percent in August to 6.3%.  This was the first increase in the state’s unemployment rate since July of 2013, when the rate increased from 7.6% to 7.7%.  The higher unemployment rate was driven by an increase in the  number of Arkansans unemployed and a decline in the number employed.  The shrinkage of the labor force continued, but it was the smallest decline since a sharp downturn began in April.  Compared to a year ago, the number of unemployed is down by over 20,000 and the unemployment rate is down by 1.4%.  However much of that decline is associated with the contracting labor force, which has fallen by 34,400 since March of this year.

Source:  Bureau of Labor Statistics

Source: Bureau of Labor Statistics

Payroll Employment
Nonfarm payroll employment was essentially unchanged in August (+100 jobs, seasonally adjusted).  Compared to August of 2013, payrolls have increased by 17,600; however, that increase took place almost entirely in the second half of 2013.  Since January of this year, payroll employment has changed little on net (+400).

Source:  Bureau of Labor Statistics

Source: Bureau of Labor Statistics

Changes in the components of payroll employment were mixed.  Jobs in wholesale trade increased by 1,400 and jobs in Government were down 1,100 — primarily local government employment, which declined by 1,000.  Before seasonal adjustment, local government employment increased by 1,400 due primarily to the start of the school year.  The fact that seasonally-adjusted employment declined shows that the increase in school-related employment was smaller than would typically be expected.

Most sectors were up from a year earlier.  Year-over-year increases in Construction and Manufacturing are particularly encouraging, given the ongoing weakness in those two sectors.  Strong employment gains in Education & Health Services, and in Leisure & Hospitality services are also prominent in the breakdown of job growth.  Three sectors have shown small year-over-year declines:  Information Services, Financial Services, and Government.

Source:  Bureau of Labor Statistics

Source: Bureau of Labor Statistics

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*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.

Metro Area GDP in 2013

By , September 16, 2014 11:44 AM

New data on GDP growth in metropolitan areas was released this morning by the Bureau of Economic Analysis.  The data show robust growth in Northwest Arkansas, but rather sluggish growth in other parts of the state.  In June, data on real GDP growth by state showed that Arkansas’ economy grew at a rate of 2.4% in 2013, well above the national average of 1.8%.  The metro data show that growth to be concentrated in the Fayetteville-Springdale-Rodgers Metropolitan Statistical Area (MSA), which grew at a 5.6% rate.  Fort Smith and Hot Springs grew slightly faster than the national average for metropolitan areas, while Jonesboro and Little Rock expanded at growth rates of less than one percent.  Memphis, Pine Bluff and Texarkana each showed negative growth from 2012 to 2013.  Out of the total of 381 MSAs in the United States, only Fayetteville, Fort Smith and Hot Springs ranked above the median growth rate.

Source:  Bureau of Economic Analysis

Source: Bureau of Economic Analysis

Although the metro GDP data are based on the best information presently available, the figure for 2013 will be subject to future revision.  As shown in the table, data for 2011 and 2012 were revised substantially since the last metro GDP report a year ago.  Data for Northwest Arkansas were subject to particularly large revisions.  Previously published data had shown growth rates of 0.1% and 0.5% in 2011 and 2012.  The revised data show growth rates of 4.4% and 1.9%.  At the other end of the scale, growth rates for Texarkana were revised downward rather sharply.

The new data also report on GDP per capita, which might be considered a better indicator of economic performance (because it accounts for differences in population growth).  Statewide, GDP per capita in 2013 was $39,111 in 2013 (inflation-adjusted 2009 dollars) — amounting to 79.6% of the national average.  As shown in the chart below, there are some significant differences in GDP per capita among the state’s metro areas.  Little Rock is the only metro area with GDP per capita exceeding the national average in 2013 (102%).  Memphis and Fayetteville stood at 90% and 80% of the national average, respectively.  The lowest per capita GDP was for Hot Springs:  the 2013 figure of $34,918 amounts to only 59 percent of the national average GDP per capita.  Since the recession trough in 2009, real GDP per capita has increased substantially in Fayetteville (+13.8%) and Hot Springs (+12.3%). It has increased more slowly in Fort Smith (+6.0%),  Jonesboro (+4.7%), Pine Bluff (+3.5%) and Memphis (+0.4%).   Little Rock and Texarkana have seen negative growth in real GDP per capita since 2009 (-2.0% and -1.5%, respectively).

Source:  Bureau of Economic Analysis

Source: Bureau of Economic Analysis

Arkansas Taxable Sales – 2014:Q2

By , September 4, 2014 3:46 PM

Newly compiled data on Arkansas Taxable Sales (ATS) suggests a slight slowdown in spending during the second quarter of 2014.   After surging 1.3% in the first quarter, ATS fell 0.3% in the second quarter (seasonally adjusted).  Compared to a year earlier, ATS was up only 0.2%.  A broader measure — Arkansas Taxable Sales Including Gasoline (ATSIG) — was also down 0.3% for the quarter.

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

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

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

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

In the five years since the trough of the recession (2009:Q2), ATS has increased 15.6% and ATSIG has increased by 17.8% — corresponding annual percentage growth rates of 2.9% and 3.3%, respectively.  It is worth noting, however, that the taxable sales statistics are not adjusted for inflation.  Using the price index for personal consumption expenditures, we can express ATS and ATSIG in real (inflation adjusted) terms.  As shown in the figure below, real measures of ATS and ATSIG remain below their previous cyclical peaks.  Since the recession trough, real ATS has increased by only 5.9% (a 1.1% annual rate), while real ATSIG has increased by 7.9% (a 1.5% annual rate).

Sources: Department of Finance and Administration, Oil Price Information Service, U.S. Bureau of Economic Analysis, Institute for Economic Advancement

Sources: Department of Finance and Administration, Oil Price Information Service, U.S. Bureau of Economic Analysis, Institute for Economic Advancement

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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 data is available here: Arkansas Taxable Sales 2014:Q2 (Excel file)

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