Labor markets in Arkansas continue to display tight conditions with unemployment near historic lows, yet payroll employment growth seems to have stalled in the first half of 2022.
The report for May showed the unemployment rate unchanged at 3.2%. The U.S. unemployment rate was also unchanged for the month, remaining at 3.6% (the difference is not statistically significant).
Underlying the unemployment rate calculation: The number of unemployed edged slightly higher (+178) and the number of employed rose by 2,367, resulting in a net gain in the labor force of 2,545. The increases in the number of employed and in the labor force have been substantial over the first 5 months of the year, but both measures remain well-below pre-pandemic totals.
In contrast to the measures of employment from the household survey, the payroll side of the employment report indicates that total employment surpassed pre-pandemic levels in November 2021. However, growth since then has been minimal. Today’s report showed a monthly decline of 2,300 jobs, and the data for April were revised downward by 1,400 (seasonally adjusted data). Total nonfarm payroll employment for May stood at 1,307,500, cumulatively down 1,500 jobs since January. Relative to the previous business cycle peak (February 2020), Arkansas payroll employment is up by 0.9%. Nationwide employment remains slightly lower than in February 2020–down 0.5%.
Although the not-seasonally adjusted data showed a slight increase in payroll employment for May, the typical growth in employment that takes place between January and mid-year has been lackluster. A breakdown of the seasonally adjusted decline of 2,300 jobs in May shows particularly prominent job-losses in Retail Trade and Health Services–two sectors that were hard-hit during the early phases of the pandemic but which have showed significant recovery since. Similarly, Leisure and Hospitality services showed a monthly decline after significant progress toward recovery. Other service-providing sectors showed job gains, including Professional & Business Services and Financial Services.
Most sectors have recovered relative to the pandemic-recession, but Leisure & Hospitality Services and Government (particularly state and local education-related employment) remain below the previous peak of 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.