Arkansas

Unemployment rate in Arkansas fell to 3.6%

 

Employment in Arkansas rose in December for the first time in six months, lowering the state’s unemployment rate to 3.6%.

Arkansas’ civilian workforce increased by 263 jobs, with 596 more jobs and 333 fewer unemployed. In December, the US unemployment rate fell to 3.5% from 3.6% in November.

By the end of the year, Arkansas had more jobs than in 2021, and the state’s labor force participation rate was up three-tenths of a percentage point year on year, with the workforce up 21,372 compared to December 2021. Unemployment stood at 3.3% in December. 2021.

“We continue to have a strong economy and we are moving in the right direction,” Commerce Secretary Hugh MacDonald said Tuesday. “I’m not too worried about a tenth of a percent jump from one month to the next, up or down.”

According to Michael Pacco, chief economist at the Arkansas Institute for Economic Development, general fears about inflation and a potential recession do not appear to be dampening employment in Arkansas.

Unemployment rose slightly over the past few months before turning around from 3.7% in November to 3.6% last month.

“The weakness is not getting worse, and there may even be a slight improvement,” Pacco said. “There was nothing phenomenal, except for a small amount of evidence against the weakening of the trend.”

With 80,000 job openings across the state, McDonald said it’s reassuring that labor force participation is picking up with more Arkansans in the job market.

“The changes in the workforce over the past year have been really positive,” said McDonald, who is in charge of economic development efforts in the state. “Our biggest challenge is finding the workforce for all the vacancies.”

Rising interest rates, inflationary pressures and the looming threat of a recession have led to some expectations of a further rise in unemployment. “Most economists expected the market to slow down, but we are in a very strong position,” Pacco said. “Perhaps economists have been too pessimistic about job prospects.”

The state’s non-farm payrolls fell by 900 in December as four major industry groups recorded significant declines.

The largest increase for the month was in trade, transport and housing and communal services, where 2,700 jobs appeared.

The professional and business services group suffered the most losses, cutting 1,600 jobs, mostly in administrative and support services. Educational and medical services lost 1,500 jobs; leisure and hospitality lost 1,300 jobs.

However, non-farm payrolls in Arkansas increased by $19,300 year-over-year, with nine industries reporting increases. More than 2,700 jobs were created in each of the five sectors, including some sectors that lost jobs between November and December. “Over the course of the year, we made progress,” Pakko said.

For example, the education and health sector, as well as the leisure and hospitality industry, recorded an increase in the number of jobs in 2022 compared to December 2021.

Educational and health services led the way with 5,000 more jobs; the manufacturing industry also gained 5,000 jobs in a year.

Leisure and hospitality, which were wiped out in the early months of the Covid-19 pandemic, has created 4,100 jobs, mostly in the hospitality and food service industries.

In 2022, the state’s lowest monthly unemployment rate was 3.1% in February and March, and its highest was 3.7% in November.

Unemployment rose in seven states in December, with four other states besides Arkansas registering declines in December, according to the US Department of Labor. Utah had the lowest unemployment rate in December at 2.2%. The next lowest rates were at 2.3% in North Dakota and South Dakota.

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