Although Arkansas labor markets have recovered considerably over the past several months, progress toward the return to full-employment has clearly slowed. For the third consecutive month, the Arkansas unemployment rate registered 4.4%. The number of unemployed Arkansans continues to decline, falling by 762 in May with a cumulative three-month decline of 2,528. But with household employment expanding slowly or not at all (down by 3,971 in May), contraction of the labor force is matching the declining unemployment, leaving the unemployment rate unchanged (at least to the nearest tenth of a percent).
Arkansas’ unemployment rate has come down considerably from its peak of 10% in April 2020, but remains above pre-pandemic levels. The national unemployment rate in May was.5.8%, significantly higher than the Arkansas rate.
Arkansas nonfarm payroll employment increased by 3,400 in May (seasonally adjusted). Sectors showing notable increases included Manufacturing (both Durables and Nondurables), Wholesale Trade, Education & Health Services, and Government. The increases in Education Services and Government reflect, in part, unusual seasonal patterns. Typically, education-related employment declines in May, but the declines this year are smaller than usual. Hence, the seasonally-adjusted figures show increases. Similarly, employment in both Retail Trade and Leisure & Hospitality Services typically rise sharply in May, but the seasonal increases this year appear smaller than usual so the seasonally-adjusted data for these series indicate small declines.
Over the past 12 months, payroll employment has expanded by 70,200, with sharp recovery in the Leisure & Hospitality sector, Retail Trade, Durables Manufacturing and Professional & Business Services. Compared to the pre-pandemic employment peak in February 2020, Arkansas employment is down by 31,600—approximately 2.2%. Nationwide, employment in May remained 5.0% lower than in February 2020.
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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.