Real GDP growth slowed significantly in the fourth quarter of 2025. The third estimate for national GDP reported an annualized growth rate of 0.5%, down from 4.4% in the third quarter. Arkansas growth slowed to 0.4% in the fourth quarter, declining from a 5.8% pace in the third quarter.

A breakdown of GDP by industry shows several sectors that contributed positively to fourth quarter growth, both nationally and here in Arkansas. Examples include Wholesale trade, Retail trade, and Health Care & Social Assistance. Sectors subtracting from growth included Nondurable Goods manufacturing and Federal government employment.

Another factor suppressing GDP growth for Arkansas was a decline in Agriculture, etc. component. Just as large swings in agricultural income have been creating volatility in Arkansas Personal Income growth rates, the output of the agriculture sector has been introducing noticeable fluctuations in real GDP growth as well. In terms of year-over-year growth rates, the agriculture sector had the effect of lowering Arkansas GDP growth in 2023 and boosting it in 2024. As of the fourth quarter of 2025, four-quarter growth for the U.S. was 2.0% and only 1.5% for Arkansas. Removing the agriculture sector from the Arkansas aggregate, the state’s non-agricultural GDP growth was 2.1%.

Longer-term trends show that Arkansas GDP growth has outpaced the U.S. over the past 6 years. Cumulative growth rates from 2019:Q4 forward show growth of 17.8% in Arkansas and 14.6 for the U.S. total.

GDP data from the third quarter of 2025 show a sharp rebound in Arkansas’ production after a slow first half of the year. Real GDP increased at an annual rate of 5.8% in Q3, compared to the U.S. growth rate of 4.4%. Arkansas was reported to have the third-highest growth rate in the nation. Over the most recent four quarters, Arkansas GDP growth was 2.2% and the U.S. growth rate was 2.3%.

The news release from the Bureau of Economic Analysis noted that Durable Goods Manufacturing was the leading contributor to growth in 13 states, including Arkansas where it contributed 0.89 percentage points. Other contributors to Arkansas’ growth included Wholesale Trade, Retail Trade, as well as Health Care. The only sectors in Arkansas showing declines were Construction and Government.

Cumulatively, Arkansas GDP has grown by 17.7% since the pre-covid level of 2019:Q4. Over the same period, U.S. GDP has expanded 14.5%. The figure below also illustrates the sensitivity of Arkansas GDP growth to recent swings in the Agriculture, Forestry, Fishing & Hunting component. Suppressing the effects of this component has little impact on the state’s third-quarter growth, but reveals that long swings in growth since 2023 are largely attributable for corresponding swings in total GDP growth.

After showing the highest growth rate in the U.S. in the third and fourth quarters of 2024, Arkansas GDP growth in 2025:Q1 again exceeded the pace of most of the nation. As previously reported, U.S. GDP contracted at an annual rate of 0.5% in the first quarter of the year. The state-level date show that Arkansas was one of only 10 states showing positive GDP growth for the quarter, having increased at an annual rate of 0.8%. Arkansas ranked 5th-highest in growth, with other positive-growth states clustered in the southeast.

The volatile agriculture component was once again a driving factor for Arkansas GDP growth in the first quarter. After declining in 2022 and 2023, the trajectory for the Agriculture sector (which also includes forestry, fishing and hunting) has sharply recovered, expanding by 77% since the second quarter of 2024.

As shown in the table below, the agriculture sector contributed 1.6 percentage points to Arkansas GDP growth. Without that sector included, Arkansas GDP growth would have been negative at -0.8%. Nevertheless, there were other factors contributing to positive growth, including Utilities, Manufacturing, and some service-providing sectors. Sectors that contributed negative growth to the total included Construction, Wholesale and Retail Trade, along with small negative contributions from some service-providing sectors.

Including the first quarter growth, the cumulative gap between the GDP growth paths Arkansas and the U.S. continued to widen. Since the fourth quarter of 2019, Arkansas GDP has grown by 17.5% while U.S. GDP has expended by 12.0%.

Along with the fourth quarter personal income estimates, the Bureau of Economic Analysis has also released data for state-level GDP [LINK]. For the second consecutive quarter, Arkansas had the fastest growing real GDP in the nation, expanding at an annualized rate of 5.1%. Nationally, GDP grew at a 2.5% rate in the fourth quarter. Compared to the fourth quarter of 2023, Arkansas GDP was up 4.6%, compared to 2.5% for the U.S.

As was the case in the third quarter, Arkansas GDP was boosted by strong growth in the sector including agriculture (Agriculture, forestry, fishing and hunting). Indeed, in three of the four quarters of 2024 agricultural output boosted total growth significantly. Nevertheless, non-Agricultural output has grown at rates of 2.4% to 4% over the course of the year.

As detailed in the table below, the agriculture sector accounted for 40% of the state’s growth rate in the fourth quarter, with other significant growth contributions from other goods-producing sectors, as well as several service-providing sectors

Over the past five years, real GDP in Arkansas has shown cumulative growth well above the national average. Compared to 2019:Q4, Arkansas GDP has expanded 17.2%, with a comparable figure of 12.2% for the U.S. The most recent two quarters contribute to a widening of that gap.

State-level data on GDP was released today in a report from the U.S. Bureau of Economic Analysis. The report showed that Arkansas GDP expanded at a rate of 2.5%–well above the nation’s growth rate of 1.4% for the quarter. Arkansas growth rate ranked #11 among the 50 states.

The state’s first quarter growth rate was highest registered since the fourth quarter of 2022. Measured over the most recent four quarters, Arkansas growth rate was 1.3%, compared to 2.9% for the U.S.

A breakdown of contributions to GDP by sector shows that Arkansas’ growth rate was largely attributable to Agriculture. Construction also contributed to growth for both Arkansas and the U.S., as did most service-providing sectors.

The growth contribution of Agriculture to first-quarter GDP stands in sharp contrast to that sector’s contributions in previous quarters. Over the four quarters of 2023, Agriculture subtracted nearly a full percentage point from the state’s GDP growth. As shown in the figures below, rising farm output contributed positively to Arkansas’ overall growth rate in 2022, but was particularly relevant for the slow growth in the first half of 2023.

Without the Agriculture sector, Arkansas’ growth rate in the first quarter of 2024 would only be 0.6%. Nevertheless, the growth rate of non-Agricultural GDP over the past four quarters has been 2.1%–compared to the 1.3% growth rate for total GDP.

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.

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.

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.

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.

After a delay of more than two months, the comprehensive revisions to state-level GDP were released this week by the Bureau of Economic Analysis. The new data showed a small decline in Arkansas GDP for the second quarter of 2023 (-0.4% seasonally adjusted annual rate), and also revealed growth patterns in 2021 and 2022 that differ significantly from previously published estimates.

The revisions were part of a comprehensive reassessment that takes place every five years, in which new and revised source data is incorporated into the statistics, along with a re-estimation of seasonal factors and price deflators. The figure below shows the impact of the revisions on quarterly growth rates since 2021. The revised statistics show generally stronger growth than initially reported during 2001 and the second half of 2022.

A comparison of the previously published and revised statistics for the first quarter of 2022 shows how much data revisions can alter our view of history. Originally reported as growth at a seasonally adjusted annual rate of 6.5%, the revised statistics show that Arkansas GDP contracted at a rate of 2.2%. The second quarter growth rate was similarly revised lower.  Clearly, the first half of 2022 showed slower growth in the state’s output than was originally reported.

The sharp downward revision to 2022:Q1 is not attributable to any single factor:  Several service-providing sectors were initially reported as showing positive growth for the quarter, with revisions showing negative growth. One very large revision: Management of companies and enterprises was originally estimated to have expanded at a pace of over 200% in 2022:Q1, whereas the revised growth rate was 11.7%.  Nevertheless, the Management sector did show a substantial increase in the third quarter (not initially reported) that made up for the revision in the first quarter.  The timing and composition of growth changed, with little effect on cumulative growth.

The impact on cumulative real GDP growth, with a comparison to U.S. growth, is shown in the figure below. For the period 2019:Q4 through 2023:Q1, cumulative growth for Arkansas was 9.2%, compared to the initially published estimate of 7.8%. After the small first-quarter decline, cumulative GDP growth by the second quarter was 9.1%—three percentage points greater than cumulative growth in U.S. GDP over the same period.

As for the decline in 2023:Q2, the breakdown in the table below shows that the slow growth was entirely attributable to a sharp decline in agricultural output (-70.8% at a seasonally adjusted annual rate), which had the effect of subtracting nearly 2.8 percentage points from the state’s total GDP growth. In other words, non-agricultural GDP expanded at a rate of 2.4% in the second quarter.