The Arkansas unemployment rate was unchanged in July, remaining at a (revised) rate of 3.9%. Some of the weakness evident in the employment report for June carried over into the July report. After a long string of extremely strong reports from the household side of the survey, the July data showed the number of employed declining and the number of unemployed increasing for a second consecutive month. Employment contracted by 2,700 and unemployment edged upward by 270, leaving a net decline in the labor force of 2,430.
Although the June and July reports represent a departure from the consistently upbeat trends of recent months, the overall situation remains undeniably positive. The unemployment rate in Arkansas is a full percentage point lower than the national average, and the 12-month decline of 1.3% is the largest drop in the nation (tied with Tennessee).
The payroll side of the employment report continues to show much weaker job growth than the household survey. Nonfarm payroll employment contracted by 2,000 jobs in July (seasonally adjusted), leaving total employment down 900 from the level of December 2015. July’s job losses were concentrated in Manufacturing, Retail Trade and Leisure & Hospitality Services. Small declines were also registered in Wholesale Trade, Transportation & Utilities, and Professional & Business Services. One strong sector was Construction, which increased by 1,100 jobs for the month.
Although payroll employment growth has been essentially zero for the first 7 months of 2016, employment is up by 16,700 jobs compared to a year ago. Most of the year-over-year job gains have been in the service-providing sectors, particularly Professional & Business Services and Education and Health Services. Employment in manufacturing continues to languish, down 1,500 jobs from a year ago and down 5,500 jobs from the employment trough of February 2010.
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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 here: Table-Seasonally Adjusted NFPE.