The state-level report on employment and unemployment shows some unwelcome weakness in Arkansas labor markets last month. The unemployment rate ticked up from 3.6% to 3.7%, while household employment showed a slight decline. The report on nonfarm payroll employment also showed a slight decline (seasonally-adjusted), although the data for February were revised higher, implying a net increase from the level reported a month ago.
The increase in the unemployment rate was driven by small changes in the underlying data. Household employment was practically unchanged, declining by only 242 (less than 0.02%). Although the downturn was small, it represented the first negative month since April of 2020 (recently revised data). The number of unemployed increased by 502 in March—the third consecutive monthly increase, with the total for the first three months of the year increasing by 1,627. As a result of the tiny decline in employment an the increase in unemployment, the labor force expanded by 260. The labor force participation rate remained stable at 58.4%
The national unemployment rate had previously been reported as rising 0.1 percentage points to 4.2 in March. Arkansas’ rate remains lower than the U.S., but the difference has narrowed to the point that it is not statistically significant.
Payroll Employment
Nonfarm payroll employment also experienced a small decline, -200 (seasonally adjusted). The data for February were revised higher by 2,500 for a net gain since our report last month. The not-seasonally adjusted data showed an increase for the month, but that was largely attributable to gains in Construction Employment and Leisure & Hospitality Services, both of which tend to experience seasonally increases in the springtime. After seasonal adjustment, the changes in both sectors were positive, but of much smaller in magnitude. Retail Trade also tends to pick up in the spring months, but was up by 600 jobs in the not-seasonally adjusted data and was down by 700 jobs after seasonal adjustment.
Although the total showed a small net decline, we saw strong increases in Manufacturing, Transportation & Utilities, and Education & Health Services. Professional & Business Services declined from March, offsetting relatively large increases of from the previous three months.
Since February of 2020, total Nonfarm Payroll Employment has expanded by 87,800, a gain of 6.8%. Over the same period, U.S. payroll employment has increased by 4.7%.
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Seasonally adjusted data for Arkansas nonfarm payroll employment, reported in a format consistent with the monthly news release from the Arkansas Division of Workforce Services, can be found here: Table-Seasonally Adjusted NFPE.