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Metro Area Employment and Unemployment – April 2024

The latest estimates for employment and unemployment in metro areas were released by the BLS this week. Unemployment rates in most of Arkansas’ metro areas were unchanged, with small declines (-0.1%) registered for Northwest Arkansas and the Fort Smith MSA. It had been previously reported that the national unemployment rate ticked up by one-tenth of a percent in April, and that Arkansas’ unemployment rate ticked down by the same amount. Unemployment rates remain lower than the national average in Northwest Arkansas, Jonesboro, and Central Arkansas. In other metro areas, unemployment rates are at or above the national average.

Source: Bureau of Labor Statistics, Smoothed Seasonally Adjusted Metropolitan Area Estimates

Payroll Employment
Nonfarm payroll employment increased in most of the state’s metro areas in April, with the notable exception of Hot Springs. The largest percentage increases were in Northwest Arkansas and Jonesboro. Compared to a year ago, Northwest Arkansas has achieved the highest growth rate, followed by Central Arkansas. Employment in Fort Smith and Jonesboro have also increased, while other metro areas show zero or negative job growth.

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

Since the pre-pandemic month of February 2020, payroll employment growth rates have varied widely. Northwest Arkansas, Central Arkansas and Fort Smith have shown steady growth, albeit at different paces. Hot Springs and Jonesboro showed employment rebounds in 2022, but growth in those metro areas has slowed. In Pine Bluff, Texarkana and Memphis employment us unchanged or lower relative to levels in February 2020.

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

Arkansas Employment and Unemployment – April 2024

The latest report on state-level employment and unemployment showed another strong month for Arkansas’ labor markets. Unemployment was down and employment continues to expand at an accelerated pace relative to the second half of last year.

The unemployment rate ticked down one-tenth of a percentage point to 3.4% in April. The number of unemployed declined by 826, the third consecutive monthly decline. The number of employed was up by 3,577—representing an accelerated pace in a six-month growth trend. The labor force continues to increase as well, up 2,731 in April.

Source: Bureau of Labor Statistics, Local Area Unemployment Statistics (LAUS)

The unemployment rate has lower for three consecutive months now, although it remains 0.6 percentage points higher than a year ago. The U.S. unemployment rate increased to 3.9% and is 0.5 percentage points higher than in April 2023 (which was a low point for both Arkansas and the U.S.).

Source: Bureau of Labor Statistics

Payroll Employment
Arkansas Nonfarm payroll employment expanded by 5,100 in April, following a revised 6,300 increase the previous month (seasonally adjusted). Nearly every major sector reflected higher employment in April, with the exception of Durable Goods manufacturing (-100 jobs). The largest employment gains were registered in Retail Trade and Health Care services.

Compared to a year earlier, Manufacturing, Wholesale Trade, and Information Services have all seen declines, with all other major sectors contributing to employment growth. Education and Health Services (particularly Health), Retail Trade, Leisure and Hospitality Services and Construction have all shown strong gains since April 2023. Total employment is up 23,600—about 1.8%. Over the same period, U.S. employment growth has also been 1.8%.

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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.

Metro Area Employment and Unemployment – March 2024

The latest report on metro area employment and unemployment, for March 2024, incorporates the last of the annual data revisions by the Bureau of Labor Statistics. Data for smoothed seasonally adjusted metropolitan area estimates were revised from January 2010 forward. As shown below, unemployment rates were revised slightly higher at the end of 2023 (with the exception of Memphis and Texarkana), and have remained steady or moved slightly lower in the first three months of 2024. As of March, most of the state’s metro areas had unemployment rates near the national average of 3.8%. Rates were lower in Fayetteville, Jonesboro and Little Rock, but higher in Pine Bluff.

Source: Bureau of Labor Statistics, Smoothed Seasonally Adjusted Metropolitan Area Estimates.
Source: Bureau of Labor Statistics, Smoothed Seasonally Adjusted Metropolitan Area Estimates.

The revisions to recent unemployment rates were generally similar to the revisions to statewide data: rates bottomed out earlier in 2023 than previously-published data suggested, rising gradually over the second half of the year. These revisions are primarily attributable to revisions of the number of unemployed workers in the underlying data.

The revised household data also had interesting implications for total employment across the state’s metro areas. As shown in the figures below, there were notable revisions going back several years for Hot Springs, Jonesboro, Pine Bluff and Texarkana–all reflecting lower employment estimates. More recent revisions show slower growth in Fayetteville, Jonesboro, Memphis and Texarkana. Recent employment growth was revised higher for Fort Smith and Little Rock. These patterns are similar to the revisions from the payroll survey that we previously reported.

Source: Bureau of Labor Statistics, Smoothed Seasonally Adjusted Metropolitan Area Estimates.

Payroll Employment
Nonfarm payroll employment increased from February to March in six of the state’s metro areas, was unchanged in Memphis and down 0.2% in Hot Springs. The fastest growth rates were in Little Rock, Fayetteville, and Jonesboro. On a year-over-year basis, Little Rock is continuing to match the growth rate of the Fayetteville metro area, with Fort Smith also showing strong growth. Growth rates in Hot Springs and Jonesboro have recently slowed, while Memphis, Pine Bluff and Texarkana have seen employment declines over the past year.

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

Over the past four years (from February 2020) growth trends have varied widely among the state’s metro areas. Fayetteville’s 12.2% tops the list, with Little Rock and Jonesboro maintaining strong growth as well (higher than the U.S. average). On the other hand, Pine Bluff, Texarkana, and Memphis continue to show net job losses over the past four years.

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

Arkansas Employment and Unemployment – March 2024

The report on state employment and unemployment for March represents another upbeat reading on Arkansas labor market conditions. The unemployment rate declined by one-tenth of a percentage point to 3.5%. The U.S. unemployment rate declined from 3.9% to 3.8% for the month.

Source: Bureau of Labor Statistics

The decline in the unemployment rate was driven by a drop of 1,228 in the number of unemployed, nearly matching the 1,322 decline of the previous month. In February and March, the number of unemployed has once again fallen below 50,000, after hovering slightly above that threshold from October 2023 through January 2024. Employment was up by 1,747 in March, outpacing the unemployment decline and resulting in a small expansion of the labor force (+519).

Source: Bureau of Labor Statistics, Local Area Unemployment Statistics (LAUS)

Payroll Employment
Nonfarm payroll employment increased by 6,500 jobs in March (seasonally adjusted). The increase represented a growth rate of 0.48% for the month (a 5.9% annual rate), which turned out to be the highest growth rate for March among all 50 states.

As shown in the table below, employment gains were widespread across sectors. Construction was off slightly from February, but remains among the fastest-growing sectors compared to a year ago. Employment in manufacturing was higher for both durable and nondurable goods. Among service-providing sectors, only Transportation & Utilities and Education & Healthcare showed small declines (although Health Care employment was up for the month). Both Professional & Business Services and Leisure & Hospitality services showed relatively large increases for the month after displaying sluggish growth over much of 2023.

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

The job growth in March raised the year-over-year growth rate of Arkansas employment to 18,500 jobs, or 1.4%. Over the same period, U.S. payroll employment expanded by 1.9%. As shown in the following figure, Arkansas continues to surpass the U.S. in cumulative growth since February 2020, with Arkansas employment expanding by 5.6% compared to 3.9% for the U.S.

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

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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. 

Arkansas Retail Sales – 2023

Editorial Note: We haven’t been reporting regularly on Arkansas Retail Sales lately, but we have continued to refine and improve our methodology (as described in the notes at the end of this post). Constructed using sales tax collection data at the county level, our Arkansas Retail Sales Indices estimate total sales to consumers from the retail trade and food service sectors. They are intended to be comparable to the Retail Trade and Food Service Sales data published by the U.S. Census Bureau.

Total retail spending in 2023 was 2.4% higher than the previous year—comparable to the 2.6% increase in U.S. retail sales. These growth rates were sharply lower than in the previous two years, and after adjusting for 4.1% CPI inflation represent negative growth in real consumer spending.

Sources: U.S. Census Bureau, Arkansas Economic Development Institute

Quarterly indices for total retail sales show that growth slowed significantly during 2022 and has been fairly flat over the course of 2023 (with both U.S. and Arkansas indices taking a slight dip in the second quarter). After the rapid growth period in late 2020 and 2021, retail spending is approximately 37-38% higher than in 2019.

Sources: U.S. Census Bureau, Arkansas Economic Development Institute

One sector that continues to show higher spending is the Food Services and Drinking Places. In the fourth quarter of 2023, spending was 10.1% higher than a year earlier in the U.S. data and 5.3% higher in the Arkansas data. It’s probably no coincidence that prices of “food away from home” continue to rise faster than other consumer prices.

Sources: U.S. Census Bureau, Arkansas Economic Development Institute

An example of one sector where sales have fallen over the past two years is Furniture and Home Furnishings. Since 2022:Q2, sales in this retail sector declined by 10.0% nationwide and by 18.4% in Arkansas.

Sources: U.S. Census Bureau, Arkansas Economic Development Institute

In contrast, General Merchandise Stores—which includes warehouse clubs and supercenters—continued to see strong sales growth, particularly in the Arkansas data.

Sources: U.S. Census Bureau, Arkansas Economic Development Institute

All of these series are nominal; i.e. not adjusted for inflation. After adjusting for price changes as measured by the Consumer Price Index, real retail spending has been declining since early 2021. As of the fourth quarter of 2023, real spending was about 14% higher than four years earlier (about a 3% annual rate of growth). Some of that growth is likely attributable to the persistent shift of consumption towards goods as opposed to services that we’ve seen since the pandemic. Spending on services is underrepresented in the retail sales sectors, relative to broader measures like total personal consumption expenditures.

Sources: U.S. Census Bureau, Arkansas Economic Development Institute, Bureau of Labor Statistics

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Methodological Notes:

Indices of Arkansas Retail Trade and Food Service Sales are constructed by the Arkansas Economic Development Institute using tax collection information from the Arkansas Department of Finance and Administration.  Documentation of our original methodology is available here: Arkansas Retail Sales—A New Data Set from AEDI.

As we have accumulated additional data, we have made several methodological adjustments:
1. With more observations, we are now able to use a more sophisticated seasonal adjustment technique. We now use the Census X-13 ARIMA procedure, with new seasonal factors estimated at the end of each calendar year.
2. Early series for Saline County, which had been calculated using municipal tax collection data, have been spliced together with data from after the introduction of a countywide sales tax in 2019.
3. Greater care has been given to identifying and adjusting for significant outlying observations, particularly with respect to month-to-month variations.
4. Automobile sales data, constructed from an index of number of vehicles sold, has been augmented by adjusting for price changes using CPI data for New and Used Vehicles.
5. We also made adjustment for the different timing of tax collections on motor vehicles. That is likely to require additional attention after the recent change from a 30-day to a 60-day grace period for registering newly purchased vehicles.

Arkansas Personal Income – 2023:Q4

The latest figures on state-level personal income show that Arkansas incomes expanded at an annual rate of 1.0% in the fourth quarter, compared to a 4.0% growth rate nationwide. Arkansas’ growth rate ranked 48th among the 50 states, with only North Dakota and Iowa showing slower growth. On a more positive note, data for the third quarter were revised upward to show a growth rate of 0.8%—previously reported to have been 0.0%. Over the past four quarter, Arkansas personal incomes have increased by only 1.4%, compared to 4.7% for the U.S.

Source: Bureau of Economic Analysis

The table below shows the year-over-year growth rates of some key components of personal income. Significant factors lowering Arkansas overall growth are Farm income and Proprietors income, as well as Transfer receipts.

Source: Bureau of Economic Analysis

The declines in Farm income and Proprietors’ income are reflections of the same phenomenon, since most farm income is received by proprietors. As shown below, large swings in farm income boosted total proprietors’ income in 2021 and 2022, but that collapsed in effect collapsed in 2023. Meanwhile, nonfarm proprietors incomes have continued to expand in 2023.

The swings in farm income are likely an artifact of the way that agricultural inventories are valued in the personal income and GDP accounts. The post-pandemic rise in commodity prices caused a positive revaluation of inventories, while more recent declines in commodity values have reversed that effect. This is likely an inaccurate measure of true agricultural income: extreme fluctuations in inventory valuations represent paper profits and losses, not necessarily income flows.

The other factor suppressing personal income growth in 2023 was the decline in transfer receipts, which is associated with the winding-down of pandemic-related spending programs. As shown below, transfers declined during 2023 to pre-pandemic levels in Arkansas.

Source: Bureau of Economic Analysis

Annual data for total for total personal income shows growth of 4.0 percent for Arkansas, compared to 5.2 percent nationwide. Contributions of Dividends, interest & rent and Transfer receipts are comparable, but Arkansas is lagging in net earnings growth.

Breaking down the growth in net earnings by sector we see that the major factor restraining Arkansas’ growth is farm earnings. Positive contributors include Construction, Wholesale trade, and Health care.

Arkansas GDP – 2023:Q4

According to the latest figures from the Bureau of Economic Analysis, Arkansas Real Gross Domestic Product grew at an annual rate of 2.2% in the fourth quarter of 2023, surpassing the 0.7% rate reported for the third quarter, but well short of the national average growth rate of 3.4%. On a year-over-year basis, Arkansas was up 1.1%, compared to 3.1% for the U.S. Comparing fourth-quarter growth rates across the 50 states, Arkansas ranked number 42.

Source: Bureau of Economic Analysis

As shown in the table below, Arkansas growth rate was constrained by declines in several sectors, including Agriculture, Wholesale Trade, Administrative & Support, and Accommodation & Food Services. Retail Trade and Durable-goods Manufacturing were the strongest growth sectors, both here an Arkansas and nationwide. The health care sector was another major contributor to growth.

Source: Bureau of Economic Analysis

Although real GDP growth has gone through two slowdowns in the past two years, the state’s cumulative growth over the past four years has outpaced that of the U.S. Since the pre-pandemic quarter, 2019:Q4, the Arkansas economy has expanded by 9.9%, compared to 8.2% for the U.S.

Source: Bureau of Economic Analysis

The largest setback for Arkansas since the Covid-contraction was in early 2022. As a result, the annual figures for 2023 versus 2022 show a growth rate of 2.5%, matching the U.S. pace. By this metric, Arkansas growth rate ranked #22 among the 50 states. In the annual figures, a decline in the Agriculture sector lowered growth by nearly a full percentage point.

Arkansas Employment and Unemployment – February 2024

Data on Arkansas employment and unemployment for February showed signs of resilience in the state’s labor markets. After rising to 3.7% over the second half of 2023, the unemployment rate ticked downward from 3.7% in January to 3.6% in February. The national unemployment rate increased from 3.7% to 3.9% in February.

Source: Bureau of Labor Statistics

The decline in Arkansas’ unemployment rate was driven by a fairly sharp drop in the number of unemployed, -1,365. The number of employed increased, but by only 1,105. As a result, the labor force declined slightly—the first monthly decline since July 2021. Although the increase in employment was not enough to offset the decline in unemployment, February marked the fourth consecutive month of employment growth.

Source: Bureau of Labor Statistics, Local Area Unemployment Statistics (LAUS)

Payroll Employment
Nonfarm Payroll Employment was up by 2,400 in February, after an upward revision of 1,400 to January’s total (seasonally adjusted data). Expanding sectors included Construction, along with several service-providing sectors. Employment in durable goods manufacturing was up slightly (+300), but non-durable goods employment was down by 1,000. Other sectors showing job declines included wholesale and retail trade, information services, and professional & business services.

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

Over the past twelve months, we’ve seen expansion across most service-providing sectors. In the goods-producing sectors, growth has been strong in construction employment, but manufacturing employment is down. Total employment growth over the past twelve months has been 15,400 jobs—about 1.1% growth. Over the same period, U.S. payroll employment growth was approximately 1.8%.

It has been four years since the peak-employment of February 2020, just before the onset of the pandemic-related contraction. Relative to that prior high-point, Arkansas employment growth has totaled 5.2%, compared to 3.6% for the U.S.

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

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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. 

Metro Area Employment and Unemployment – January 2024

The Bureau of Labor Statistics has released new data on metro area employment and unemployment for January 2024, including annual revisions to previously-reported data.

The unemployment data have been partially revised, but comparable historical data will not be available until April 19. Today’s release did include revised, not-seasonally adjusted data for January 2023 and December 2023, so we can make some comparisons.  First, the figure below compares the new January unemployment rates with the revised unemployment rates from January 2023. Over the year increases ranged from 0.1 to 0.6 percentage points, with the exception of Texarkana, where the rate declined by 0.2. Five metro areas had unemployment rates above 4% in January 2024, while Fayetteville, Jonesboro, and Little Rock had rates below the statewide average.

Source: Bureau of Labor Statistics, Local Area Unemployment Statistics (LAUS)

The revisions to the data for metro areas generally appear to follow the pattern seen in the revised data for statewide unemployment. Specifically, that rates were revised lower for January 2023 but ended the year higher than originally reported.

Source: Bureau of Labor Statistics, Local Area Unemployment Statistics (LAUS)

Payroll Employment
Nonfarm payroll employment was up 0.3% in the Little Rock metro area, but unchanged or lower for the rest of the state. Pine Bluff and Texarkana had the largest declines. Compared to a year earlier, Little Rock showed the strongest growth at 2.0%, slightly outpacing Northwest Arkansas. As discussed below, this reversal of relative growth trends is largely attributable to revisions to the employment data for those two metro areas.

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

Over the longer run, cumulative growth rates since February 2020 have varied widely across the state, ranging from 11.1% in Northwest Arkansas to -2.8% in Pine Bluff.

Revisions to Payroll Employment Data
Payroll employment data for metro areas that was released this week was subject to the same annual benchmark revision process as for the statewide data. The revisions were generally limited to the period since April 2022 for not seasonally adjusted data, with minor changes to seasonal factors going back to 2019. The BLS report also mentioned that “Some not seasonally adjusted and seasonally adjusted series have been revised as far back as 1990.” The data for Arkansas metro areas include examples of these long-term adjustments of the series.

As shown in the set of figures below, employment data for Fayetteville and Fort Smith were subject to a downward shift for all pre-2022 data, while Little Rock shows a corresponding upward revision to the historical series.

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

More interesting are the revisions to recent growth trends. Over the two year period from December 2021 to December 2023, employment growth for Fayetteville was previously estimated to be 9.1%. In the revised data, the growth rate is only 6.9%. Growth rates for Jonesboro, Memphis, and Texarkana were also revised lower. Growth for Fort Smith and Hot Springs were revised higher, but the largest change was for Little Rock, where the previously-reported growth rate of 2.4% was revised up to 4.9%. The upward revision for Little Rock and the downward revision for Fayetteville, both primarily affecting data for 2023, resulted in the reversal of year-over-year growth patterns.

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

 

Arkansas Employment and Unemployment – January 2024

New employment and unemployment data for January was mixed. Data from the household survey showed only small changes in the number of employed and unemployed Arkansans. The payroll survey showed mixed results for the month, but data revisions suggest significant changes from previously reported levels and growth rates for some sectors.

After being revised upward from 3.4% to 3.7% for December (see HERE), the unemployment rate was unchanged in January. With the recent revisions, the Arkansas unemployment rate has matched the U.S. rate In November, December and January. Last week the Bureau of Labor Statistics reported that the national unemployment rate rose to 3.9%.

Source: Bureau of Labor Statistics

The data underlying the unemployment rate were little changed in January. The number of unemployed was estimated to have risen by 46, and the number of employed increased by 460, for a change in the labor force of just over 500. The figures below illustrate these changes in the context of the recent revisions to the data.

Source: Bureau of Labor Statistics, Local Area Unemployment Statistics (LAUS)

Payroll Employment
The not-seasonally adjusted data for nonfarm payroll employment showed a decline of 17,700 jobs from December to January. However, there is always a post-holiday season drop-off in January employment. After seasonal adjustment, the data show an increase of 2,700 jobs. Monthly changes were mixed, with Construction and Retail Trade showing significant increases. Employment declines were reported for Durable Goods Manufacturing, Wholesale Trade, Financial Services and Other Services. Differences across sectors are even more noticeable when comparing growth from a year ago. Year-over-year gains in Construction, Retail Trade  and Education and Health Services have been significant. Other sectors have shown small changes over the past year. Manufacturing, Transportation & Utilities, and Professional & Business services are three sectors that have shown notable job losses in the past 12 months.

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

Revisions to Payroll Data
Having concluded their annual benchmark revisions, the Bureau of Labor Statistics included newly revised data on payroll employment in this morning’s report. The revised not-seasonally adjusted data, now adjusted to 2023 benchmark levels, were revised back to April 2022. Seasonal factors were subject to small revisions going back to January 2019. For total nonfarm payroll employment, the revisions had the effect of lowering the level of employment by 7,400 as of December 2023. The new data show a two year growth rate of 4.0% for the period December 2021 through December 2023, down from the previously-reported 4.4%.

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

The table below details the changes, by sector, in the levels of employment for December 2023, along with changes in the two-year growth rates for December 2021 through December 2023. Because the largest revisions were made to the most recent data, the changes in the levels of employment reported in the first column tend to carry over into revisions of the corresponding two-year growth rates. Some of the more notable revisions were for Retail Trade, Transportation & Utilities, Information Services, and Other Services.

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

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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.