Unemployment rate – Page 14 – Arkansas Economist

Arkansas Employment and Unemployment – August 2011

by Michael Pakko
Employment/Unemployment, Seasonal adjustment
September 16, 2011

The Arkansas unemployment rate rose for the fourth consecutive month in August, up one-tenth of a percent to 8.3%. According to the Bureau of Labor Statistics (BLS), Arkansas was one of 26 states that saw a rise in the unemployment rate in August. The statistics from the household survey showed that the number of employed was down 3,148 while the number of unemployed was up by 1,193.

As shown in the figure below, the unemployment rate in Arkansas has been trending upward since the beginning of the year. For most of the recession and recovery period, Arkansas unemployment rate was 2 percentage points below the unemployment rate for the U.S. It has now crept up to within 0.8 percentage points of the the national average.

The payroll survey was also disappointing. Seasonally adjusted data for August showed a decline of 1,900 jobs, on top of a downward revision to the July data. After peaking in April, payroll employment has declined by 7,000 jobs in the past four months. The table below shows that job losses in August were widespread. The only sectors that showed positive monthly growth were Government (+3,000 jobs) and Manufacturing (+400). Losses were particularly sharp in Professional and Business Services (-1,700) and Construction (-1,900). Employment in construction had shown a sharp increase in July, but the August figures erased that gain.

It is never advisable to put too much emphasis on one month’s data, or on any one particular statistic. But today’s employment report is the fourth consecutive report indicating weakness in Arkansas’ job market. Data from both the household survey and and payroll survey suggest that conditions have deteriorated markedly since April.

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*Seasonally adjusted data for nonfarm payroll employment, reported in a format compatible with the monthly news release from the Arkansas Department of Workforce Services, are available here: Table – Seasonally Adjusted NFPE

Metro Area Employment and Unemployment – July 2011

by Michael Pakko
Employment/Unemployment, General Information, Metro Areas (MSAs), Seasonal adjustment
August 31, 2011

As previously reported, the statewide unemployment rate rose slightly in July, from 8.1% to 8.2% (seasonally adjusted). New data released this morning shows that most of Arkansas’ Metropolitan Statistical Areas (MSAs) experienced stable or lower unemployment rates. As shown in the table below, not-seasonally-adjusted unemployment rates declined in all of the state’s MSAs except for Texarkana. Unemployment tends to be higher during the summer months, reflecting the impact of summer vacation for school employees and students. There is typically a very slight drop in unemployment rates between June and July. After accounting for these seasonal regularities, seasonally adjusted figures show unemployment rates declining in Hot Springs, Jonesboro, Little Rock, Memphis, and Pine Bluff. Texarkana saw a small uptick in unemployment, while rates in Fayetteville and Fort Smith were unchanged.

Sources: Bureau of Labor Statistics, Institute for Economic Advancement

The Bureau of Labor Statistics reported that unemployment rates in July were lower than a year earlier in 257 of the nation’s 372 MSAs, higher in 94, and unchanged in 21. Here in Arkansas, only Hot Springs shows a lower unemployment rate than in July 2010.

The figures for nonfarm payroll employment in Arkansas’ MSAs show mixed results for July: Compared to the previous month, employment declined in Fayetteville, Fort Smith and Texarkana. Increases were recorded for Pine Bluff, Memphis, and Hot Springs. The payroll data for Hot Springs have been particularly volatile in recent months, but as of the most recent observation, Hot Springs employment is 7.3% higher than a year ago, 7.8% higher than the employment trough of February 2010, and 2.6% higher than at the start of the 2008-09 recession. Jonesboro also shows gains over all of those time-horizons, with employment up 1.0% since the start of the recession.

Arkansas Employment and Unemployment – July 2011

by Michael Pakko
Employment/Unemployment, General Information, Seasonal adjustment
August 19, 2011

The unemployment rate in Arkansas rose again in July, reaching a new cyclical high of 8.2% (up from 8.1% in June). The latest data from the Bureau of Labor Statistics (BLS) and the Arkansas Department of Workforce Services (DWS) indicated that the number of Arkansans unemployed rose for the third straight month, up 1,400 in July following a cumulative increase of 3,600 in May and June. The household survey also showed a decline in the number of those employed, down 7,400.

The employment data from the household survey have been showing a downward trend since March, falling by a total of nearly 25,000. However, the establishment survey (which is based on reports from employers) shows a slowdown, but with net positive growth since the beginning of the year. As illustrated in the figure below, employment measured by the payroll survey has been growing–albeit irregularly–since February 2010. But since March, net growth in payroll employment has been virtually zero (-0.02%).

The payroll data for July shows a slight uptick in employment, rising by 600 jobs from the revised level in June (seasonally adjusted). As shown in the table below, employment declines were registered in some key sectors for the Arkansas economy, including Manufacturing; Trade, Transportation, & Utilities; and Professional & Business Services. Employment in Leisure & Hospitality Services and Education & Health Services expanded. In a surprising break from its sluggish recent trend, construction employment rose sharply in July. Looking at job growth since then end of 2010, only one sector (Manufacturing) has shown negative net growth. Led by gains in the service providing sectors, total payroll employment has increased by 7,100 jobs during 2011.

The seasonally adjusted data from the BLS summarized in the table above is quite a bit different than the not seasonally adjusted data in the press release from DWS. Before seasonally adjustment, the Arkansas payroll employment was down by 15,600 jobs. Most of this decline was registered in the category of Local Government (-13,200), reflecting the seasonal decline in employment in the state’s public schools. The not-seasonally-adjusted data also show a larger decline in Professional & Business Services.

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*Seasonally adjusted data for nonfarm payroll employment, reported in a format compatible with the monthly press release from the Arkansas Department of Workforce Services, are available here: Table – Seasonally Adjusted NFPE

Metro Area Employment Summary – 2011:Q2

by Michael Pakko
Employment/Unemployment, Metro Areas (MSAs)
August 3, 2011

The latest data on employment and unemployment for Arkansas’ metro areas indicates that unemployment rates have been increasing across the state. This morning’s news release from the Bureau of Labor Statistics reported that “unemployment rates were lower in June than a year earlier in 224 of the 372 metropolitan areas…” Unfortunately, none of Arkansas’ metro areas were included in that total. In fact, unemployment rates in Arkansas have increased across the board during the second quarter of 2011.

On a month-to-month basis, some of the June unemployment rates reported today jumped substantially higher than May. However, higher unemployment in June is a recurring seasonal phenomenon. After adjusting for seasonality, the increases in unemployment rates were more modest — but they were increases, nonetheless. The June jump in unemployment was largest in Fort Smith (+0.5 percentage points), but was also substantial in Fayetteville, Hot Springs, and Pine Bluff (+0.3 percentage points each). Unemployment in the Little Rock MSA was essentially unchanged.

When the statewide data was released, we noted that June’s payroll survey indicated somewhat greater strength in labor markets than did the household survey. The same is true of the metro area data. Nonfarm payroll employment declined in four of the state’s MSAs, but increased in three. Hot Springs showed a particularly large drop in payroll employment in June. However, this only partly offset substantial increases registered in April and May. Compared to a year ago, employment in both Hot Springs and Texarkana are up more than one percent.

Relative to the statewide trough in employment registered in February 2010, all but one of Arkansas’ MSAs have shown positive growth. Employment in Pine Bluff remains 2.2% below the level of February 2010, but is slightly above a low-point registered in February 2011. Compared to the start of the recession, employment changes range from down 6.3% in Fort Smith to essentially unchanged in Jonesboro.

Arkansas Employment and Unemployment – June 2011

by Michael Pakko
Employment/Unemployment, General Information
July 22, 2011

According to new data from the Bureau of Labor Statistics and the Arkansas Department of Workforce Services (DWS), the unemployment rate in Arkansas rose by 0.3 percentage points in June, from 7.8% to 8.1%. The Arkansas unemployment rate is now higher than it has been at any time during the recession and recovery. The household survey reported an increase in the number of unemployed by over 2,500 and a decline in the number of employed by approximately 11,000. At 109,000, the number of unemployed in Arkansas is now at a new all-time high. As shown in the chart below, recent increases in the Arkansas unemployment rate have been following the national trend, although the rate is still more than one percentage point lower in Arkansas than the national average.

The news from this morning’s report was not all bad, however. This is one of those occasions when the independent payroll survey provides a different picture than the household survey. According to the payroll report, employment was up by 2,100 in June (seasonally adjusted), with the May number revised upward slightly as well. Since the trough of February 2010, nonfarm payroll employment in Arkansas has increased by 27,600. That increase represents approximately 47% of the jobs lost from the start of the recession until February 2010.

As shown in the table below, employment gains were concentrated in the service-providing sectors, particularly Education & Health Services and Professional & Business Services. The crucial sectors of Manufacturing and Trade, Transportation & Utilities showed rather substantial losses for the month. Employment in the construction sector showed a welcome increase. Nevertheless, employment in both Construction and Manufacturing are down for the first six months of the year.

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Metro Area Unemployment Rates – Update

by Michael Pakko
Employment/Unemployment, General Information, Seasonal adjustment
June 29, 2011

The Bureau of Labor Statistics announced this morning that unemployment rates were “lower in May than a year earlier in 274 of the 372 metropolitan areas, higher in 85, and unchanged in 13.” Among Arkansas Metropolitan Statistical Areas (MSAs), unemployment rates were lower for only 2, with rates higher in the remainder (relative to a year earlier). Comparing May to the previous month, seasonally adjusted data show that the unemployment rate increased in 3 MSAs, declined in 3, and was unchanged in Hot Springs.

Arkansas Employment and Unemployment – May 2011

The unemployment rate in Arkansas ticked upward in May, rising from 7.7% to 7.8%. According to data from the Bureau of Labor Statistics and the Arkansas Department of Workforce Services (DWS), the household survey showed that the number of unemployed rose by over 1,100 while the number of employed dropped 4,800. This was the second consecutive monthly decline in the number of employed following a string of increases since July 2010. DWS Communications director Kimberly Friedman pointed out that the uptick in the unemployment rate and the decline in the labor force “mirrors the trend seen at the national level.” It is also likely to reflect disruptions due to severe weather conditions in Arkansas during late April and May.

The figures for nonfarm payroll employment from the establishment survey also showed a contraction in the total number of jobs in May, down 5,400 (seasonally adjusted). As shown in the chart below, the May reading fits the recent pattern of month-to-month volatility. From a longer-run perspective, however, the latest monthly observation provides little indication of any change in the trend of positive job growth that has prevailed since February of 2010.

Job losses in May were concentrated in two sectors: Trade, Transportation, and Utilitites (TT&U); and Professional and Business Services (P&B). In the broad TT&U sector, the raw data showed only a slight decline in jobs (-200). However, employment in this sector typically expands during May so the seasonally adjusted figures show a decline of 3,100 — with much of the loss concentrated in Retail Trade (-1,800). In the P&B services sector the number of jobs was down by 2,400 (seasonally adjusted) with the losses concentrated in Administrative & Support Services (-1,700). The Administrative and Support subsector includes temporary positions arranged through employment agencies–so while it has shown some of the largest gains over the past year (+2,900) it is one of the first areas to show job losses in a temporary employment contraction (-1,400 in May).

The tornadoes and flooding that hit many parts of the state during April and May are likely to have suppressed employment growth temporarily, but should have little lasting effect. In fact, recovery efforts are likely to provide some support for job growth in coming months — particularly in the construction sector. Underlying growth trends are also likely to result in a rapid recovery in the Administrative & Support Services sector. The key sector to monitor in June will be TT&U, which accounts for a large share of total employment in Arkansas. If the factors underlying the weak employment report for May are indeed temporary, we should see robust recovery in this sector. Continued stagnation in this sector would be a sign of more fundamental economic weakness.

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Arkansas Employment and Unemployment – April 2011

The latest reports on conditions in Arkansas labor markets confirm the trend of slow but steady improvement. According to data from the Bureau of Labor Statistics and the Arkansas Department of Workforce Services, the unemployment rate in March was revised downward by 0.1% to 7.7%, and remained at that level in April. The underlying data from the household survey showed a decline in the labor force and the number of employed persons in April, representing breaks in what had been generally upward trends in those series. More important, however, the data also showed a decline in the number of unemployed — down 341 from the previous month. So far in 2011, the number of unemployed in Arkansas has fallen by over 1,400.

The survey of employers showed an accelerating pace of employment growth. The total for March was revised upward by 2,000 jobs and payrolls expanded by an additional 4,800 in April (seasonally adjusted). Over the first four months of the year, employers have added over 12,000 jobs to their payrolls. And since the trough of February 2010, employment has increased by 31,400. This 16-month expansion represents a milestone of sorts: Over half of the total jobs lost between the start of the recession and February 2010 have now been recovered. By comparison, employment nationwide has risen by 1.8 million, only about 20% of the total number of jobs lost from the start of the recession.

Employment in construction continues to languish, declining by another 900 jobs in April (seasonally adjusted). Over the past 12 months, construction employment is down by 2,600. Manufacturing employment increased by 1,200 in April, but is still below the level of a year ago. Service-providing jobs rose in every major sector in April, with the exception of “Other Services.” Gains were particularly strong in Leisure and Hospitality; Professional and Business Services; and Trade, Transportation and Utilities.

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Metro Area Unemployment – 2011:Q1

by Michael Pakko
Employment/Unemployment, General Information, Metro Areas (MSAs), Seasonal adjustment
April 28, 2011

The latest unemployment rate figures for Arkansas metro areas provide another example of the importance of considering seasonal patterns when analyzing month-to-month data. The raw, not-seasonally adjusted data released yesterday by the Bureau of Labor Statistics show unemployment rates declining between February and March for each of Arkansas’ metropolitan statistical areas (MSAs). However, it is typical for March that unemployment rates decline: Economic activity generally begins a seasonal resurgence in the spring, so unemployment rates tend to decline. If we seek to look beyond routine seasonal changes in the data to discern longer term trends and changes associated with the business cycle, it is helpful to consider seasonally adjusted figures.

As shown in the table below, the not-seasonally adjusted unemployment rate for Arkansas fell from 8.7% in January to 8.4% in Feburary, then to 8.0% in March. Yet, the seasonally adjusted figures show that the unemployment rate was steady at 7.8% for those three months. The decline from January to March was entirely seasonal in character, indicating nothing to suggest that the economic recovery was resulting in lower unemployment. Similarly, the not-seasonally adjusted data for Arkansas’ MSAs show declining unemployment rates across the board. But to what extent were those changes purely seasonal?

The seasonally adjusted data show that a portion of the lower unemployment in February represented a true decline. The data show that unemployment rates declined in five MSAs, remaining unchanged or rising in the other two. In March, however, seasonal factors were more important. The not seasonally adjusted data show lower unemployment rates for all seven MSAs while the seasonally adjusted figures show higher unemployment in all seven. So, why did unadjusted unemployment rates decline in March? Because it was March.

Beyond the month-to-month uncertainty associated with seasonal factors, metro area data are also more variable than the state-level or national data. Hence, it is even more important to view MSA data from a longer term perspective. With this consideration in mind, the figure below shows quarterly average unemployment rates for Arkansas MSAs. Rates declined slightly in the spring of 2010, but then rose during the second half of the year (partly as a result of temporary Census workers being idled). In nearly all of Arkansas’ MSAs, unemployment appears to have peaked in the fourth quarter of 2010 and declined in the first quarter of this year. By way of comparison, the seasonally-adjusted unemployment rate for the state as a whole was 7.9% in 2010:Q4 and 7.8% in 2011:Q1.

Arkansas Employment and Unemployment – March 2011

by Michael Pakko
Employment/Unemployment, General Information
April 19, 2011

Arkansas’ unemployment rate remained unchanged at 7.8% in March (seasonally adjusted). The latest data from the Bureau of Labor Statistics and Arkansas Department of Workforce Services show that the number of unemployed rose slightly, but the number of employed rose by nearly 4,400. The change in March represents the eighth consecutive month of increases.

The household survey and the establishment survey can sometimes provide conflicting signals. However, the two surveys have recently been presenting a consistent picture of the Arkansas employment market. As shown in the figure below, both measures have generally been rising since the beginning of 2010. The household survey shows employment up by over 21,000 since December of 2009. Meanwhile the payroll survey shows employment up by about 24,600 since that series hit a trough in February 2010.

The latest reading on nonfarm payroll employment shows the number of jobs up by approximately 3,200 in March (seasonally adjusted). Monthly losses were recorded in several service-providing sectors, including two of the areas that have shown the most strength during the recovery, Education and Health Services, and Business and Professional Services. Construction and Manufacturing both showed increases for the month, but employment in these goods-producing sectors is down from a year ago. Total government employment is also down from a year ago, with lower Federal government employment relfecting (in part) the temporarily high Census Bureau employment of spring 2010.

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*Seasonally adjusted data for nonfarm payroll employment, reported in a format compatible with the monthly press release from the Arkansas Department of Workforce Services, are available here:

Table – Seasonally Adjusted NFPE