The state-level report on employment and unemployment that was released today shows little change in current conditions or the near-term outlook for Arkansas. For example, the unemployment rate, at 3.4%, remains in the 3.5%+/- range in which it has fluctuated over the second half of 2022. The rate remains historically low.
However, revisions to the underlying data for both the household and employment surveys shows much stronger employment growth over the past two years than previously estimated. The revision to the unemployment rate amounted to 0.2 percentage points in December: previously reported at 4.6%, it is now reported to have been 4.4% (with the January rate unchanged from that revised estimate). On the other hand, the number of employed Arkansans was revised upward over the past two years, resulting in a total for December that is 22,642 higher than previously reported. From December 2020 through December 2022, previous reports showed an increase in the number of employed of approximately 35,000. The revised figures show an increase of nearly 59,000 jobs. This revision implies an annual growth rate of 2.3% from December 2020 through December 2022, compared to the 1.4% pace that was previously reported.
The increase in employment resulted in a similar boost to the total labor force figures. After the revisions, Arkansas post-pandemic decline in the labor force participation rate appears much smaller than previously reported, and the rate is now only about 0.5 percentage points below the pre-COVID level.
The data from the Nonfarm Payroll Employment report were also subject to annual revisions. Although compiled from completely independent source data, the revisions to Arkansas payroll employment were also substantial. Total employment for December 2022 was revised upward by 27,000 jobs. Most of the revision was for 2022: the growth rate from December 2021 through December 2022 was originally reported to be 1.4%; it is now estimated to have been 3.3%.
The table below summarizes the revisions to the super-sectors covered by the payroll employment data. The sectors with the largest revisions to both growth and employment levels included Construction, Retail Trade, and Other Services. The only sectors to show negative data revisions were Manufacturing (related to nondurables production), Information Services, and Government.
The newly-revised data, updated for January 2023, show a monthly increase of 6,700 jobs (seasonally adjusted), with a cumulative twelve-month gain of 44,200 (a 3.4% growth rate). The sectors showing substantial one-month increases were concentrated in the service-providing sectors: Professional & Business Services, Education and Health Services, & Leisure and Hospitality Services. Wholesale Trade also expanded by over 1,000 jobs, while Retail declined slightly.
Compared to the pre-pandemic peak of February 2020, the revised nonfarm payroll statistics show a net gain of 56,700 jobs — approximately 4.9% cumulative growth. By comparison, U.S. payroll employment is only 1.8% above the pre-pandemic level.
# # #
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.