The latest employment report from the U.S. Bureau of Labor Statistics (BLS) and the Arkansas Department of Workforce Services (DWS) show that the unemployment rate in Arkansas fell by 0.2 percentage points in January to 7.6%.  This was the fourth consecutive monthly decline.  The Arkansas unemployment rate is now 0.6 percentage points lower than its (revised) peak of 8.2 in July 2011.

Source: Bureau of Labor Statistics

The  underlying details in the January unemployment report support a positive interpretation:  The number of employed persons was up by nearly 6000, while the  number of unemployed was down almost 2000.  As a result, the unemployment rate decline occurred against a backdrop of a substantial expansion of the labor force.   Since the unemployment rate peak in July 2011, the number of employed has risen by nearly 24,000 and the number of unemployed is down 6200.

The independent payroll survey showed modest job gains for the month, with increases spread across several sectors.  Although the not-seasonally-adjusted data showed a net decline for the month, the job losses were largely seasonal as holiday-related employment declined (particularly in the Retail Trade and Leisure & Hospitality sectors).  Seasonally adjusted data showed an increase of 4600 jobs for the month. Goods producing sectors saw an increase of 2300 jobs, with most of the gains in construction. Service providing sectors showing gains included Trade, Transportation & Utilities (+2200), Education & Health (+1700), and Leisure & Hospitality (+1700).  These increases were partly offset by notable job-losses in Professional & Business Services (-1100) and Government (-2100).

Source: Bureau of Labor Statistics

Compared to a year ago, the newly-revised payroll data show a net increase of 4300 jobs.  Education & Health Services continued to be the strongest-performing sector over the past 12 months, adding 4000 jobs.  In contrast, manufacturing employment has fallen by 4600 jobs.

Benchmark Revisions

This monthly report on payroll employment included the annual benchmark revisions to the data.  As previously reported, we were anticipating a sharp downward revision to the jobs data for early 2011.  As of the new benchmark date (2011:Q1) we expected to see a downward revision of approximately 11,000 jobs.  The actual revision was down 10,400.  Estimation of new seasonal factors and updated source-data also resulted in a downward revision to the third-quarter statistics.  At the end of 2011 (December) total payroll employment is now estimated to have been 1161.3 thousand, down 14.3 thousand from the previously-estimated 1175.6 thousand.  The revised data now show that 2011 was a year of negative net employment growth.  From December 2010 through December 2011, total payroll employment in Arkansas fell by about 3,100 jobs.

Sources: Bureau of Labor Statistics, Institute for Economic Advancement

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