Arkansas Economic Development Institute

Arkansas Personal Income – 2016:Q3

By , December 20, 2016 3:43 PM

Personal income increased by 0.9% in Arkansas in the third quarter, a slightly smaller increase than the nationwide gain of 1.1%.  Percentage changes among the 50 states fell within a relatively narrow range, from +0.4% in Oklahoma to +1.4% in South Dakota.  Arkansas’ growth rate ranked #41.  Over the most recent four quarters, Arkansas personal income increased by 3.3%, compared to a 3.5% increase for the U.S.  Over the course of the current economic expansion (from 2010:Q1), Arkansas income growth has averaged 4.2% while the U.S. average has been 4.3%.

Source: Bureau of Economic Analysis

Source: Bureau of Economic Analysis

Net earnings rose 1.1% in Arkansas and 1.3% for the U.S.  This morning’s report from the Bureau of Economic Analysis noted that earnings “was the leading contributor to growth in personal income in most states.”  Income from dividends, interest, and rent was also an important contributor for Arkansas, as has been the case throughout the current expansion.

Source: Bureau of Economic Analysis

Source: Bureau of Economic Analysis

Earnings by sector:  Earnings growth in the third quarter was strongest in service-providing sectors, although growth was spread fairly evenly across sectors.  The categories of Farm income, Mining, and Forestry were the only sectors with negative income growth.  Income in the construction sector showed an encouraging 1.1% rate of increase in Arkansas.

Source: Bureau of Economic Analysis

Source: Bureau of Economic Analysis

On a per capita basis, Arkansas personal income increased 0.8% in the third quarter, a slightly smaller increase than the U.S. average of 0.9%.  At $39,602, per capita personal income was 79.7% of the U.S. average ($49,681), down one-tenth of a percentage point from the 79.8% reading in the second quarter.

Source: Bureau of Economic Analysis

Source: Bureau of Economic Analysis

Arkansas Employment and Unemployment – November 2016

By , December 16, 2016 12:19 PM

Arkansas unemployment rate remained unchanged at 4.0% in November.  The nationwide unemployment rate fell by 0.3 percentage points to 4.6%, narrowing the gap between the U.S. and Arkansas unemployment rates.  Nevertheless, the news release from the Bureau of Labor Statistics noted that Arkansas remains one of 16 states where the unemployment rate is significantly lower (in a statistical sense) than the national average.

Source: Bureau of Labor Statistics

Source: Bureau of Labor Statistics

For the sixth consecutive month, the labor force data show a decline in the number of employed Arkansans (-3,929), reinforcing the evidence from the payroll survey that employment growth has slowed during the year (see below).   On the other hand, the number of unemployed was also down in November (-1,130), following a revised decline (-277) in the previous month.  As a result of the lower numbers for both employment and unemployment, the labor force was down sharply in November (-5,059).

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

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

Payroll Data
Nonfarm payroll employment declined by 2,000 in November (seasonally adjusted).  The sector experiencing the largest decline was Retail Trade, down 3,400 from the previous month and down 2,400 from November of 2015.  Seasonal factors are likely at play here:  With internet sales comprising a larger proportion of holiday shopping, the seasonal increase in retail hiring has been slower than in previous years, resulting in a seasonally-adjusted decline and a year-over-year decline.

Professional and Business Services continues to be the strongest performing sector, both nationally and here in Arkansas.  Meanwhile, employment in the Education and Health Services sectors has recently shown signs of slowing.  Over time, these two service-providing sectors (Professional and Business, Education and Health) continue to be the engines of growth in the state’s employment.  Each has contributed 5,800 new jobs over the past 12 months, with all other sectors collectively showing a net decline of 2,800 jobs.

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

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

Projected Data Revisions
The BLS recently released second quarter data from the Quarterly Census of Employment and Wages, which provides a more accurate assessment of payroll employment than the Current Employment Statistics.  Based on this new information, our projection for upcoming revisions of Arkansas payroll employment data has been revised further downward.  As of today’s report, we now expect the downward revision to total about 9,500 jobs.  The data revisions primarily affect the first half of 2016, so after expected revisions we now expect that the November 2015 to November 2016 change in employment will total only 5,800 after revision, compared to 8,800 in the currently reported statistics.  (The revised data will not be officially available until March 2017).

Sources: Bureau of Labor Statistics (CES, QCEW) and calculations by the Institute for Economic Advancement

Sources: Bureau of Labor Statistics (CES, QCEW) and calculations by the Institute for Economic Advancement

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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.

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%.

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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