Arkansas Farm Bureau President Randy Veach, Aristotle, Inc. President Elizabeth Bowles, and Northwest Arkansas Council CEO Mike Malone discussed the state of the state’s economy on Sunday night’s edition of Talk Business Arkansas – a television show that airs in central Arkansas.
The panel explored the direction of Arkansas economic conditions and what they see happening in their fields of agriculture, technology, start-up companies and Fortune 500 firms.
All three panelists agreed that despite steady unemployment in the 7.3% range, improving home sales and modest consumer spending increases, the economy remains “mixed.”
Veach said the unemployment rate is still too high despite its decline from higher levels during the recession and early recovery.
“There’s a lot of folks that have been looking for a job for a long time. They’ve quit looking for a job now and it’s just hard to know how many that is,” he said.
He also said that while land values have been increasing – a potentially good trend – other aspects of agriculture, such as the cost of farming have risen.
“A lot of our expenses and input items have really increased in expense,” he said.
Veach was asked if he thinks a contentious Farm Bill will pass Congress this year.
“Probably not,” he said. “The likelihood of us getting something resolved between now and the end of the year is going to be difficult for many reasons.”
Not only are the House and Senate far apart on aspects of the nutrition portion of the bill, they also may be at an impasse on repealing the permanent aspects of the law, and Veach worries that without the bill, Arkansas will lose hundreds of millions of dollars of direct payments – an economic stimulus that will hurt the state’s farmers.
Bowles said she’s encouraged that home sales are improving. That tends to be an economic indicator that results in broadband addition, which her firm Aristotle, Inc. supports. She wants to see consumer spending improve in hopes of jump-starting more broadband users and, in turn, higher marketing spending which would boost the web site and marketing division of her technology firm.
“Overall, while I would say that it [the economy] is moving in the right direction, it’s moving much slower, at a much slower pace than we would prefer to see – mixed definitely,” Bowles said.
She also has high hopes for a state initiative that is examining broadband expansion in Arkansas’ public schools. The state is behind other states in its push for broadband to K-12 schools and Bowles serves on a Governor’s task force looking for a solution to rapidly and expansively broaden capabilities for high-speed Internet service throughout the state.
“I think that you will see a lot of movement towards getting broadband into the public schools and having providers offer broadband in the public schools will allow them to offer broadband to the communities that surround the schools, which I submit to you is equally important,” she said. “Because once those kids leave school, they have to have broadband at home so they can study.
Bowles hopes for a “blended solution” that would incorporate traditional broadband models – such as cable and fiber – with new technology, such as fixed wireless broadband at a much lower cost.
Malone, who heads the influential Northwest Arkansas Council – a representative group of the biggest companies in that corner of the state, also sees mixed signals in the state’s overall economy. Northwest Arkansas has experienced a stronger rebound and has surpassed the number of workers lost during the recession.
“I think statewide, I’d agree with my counterparts that it’s mixed, but I like the optimism,” he said. “I think if we see a couple of more quarters like we’ve seen the first half of this year, I’m ready to declare it good.”
While Wal-Mart, Tyson Foods, J.B. Hunt and the University of Arkansas serve as major catalysts for the northwest Arkansas economy, in recent years Malone’s group has focused efforts on a start-up ecosystem to support those firms and to grow the next generation of Sam Waltons, John Tysons and J.B. Hunts.
“The area was built by some of the world’s best entrepreneurs decades ago and they’ve really made a success of all those industries,” Malone said.
He noted that earlier this year three start-up companies in the region received more than $100 million in investment capital from outside of northwest Arkansas.
“We’re real encouraged by our start-up scene. There are workforce challenges – we certainly need technology-trained workers. There are capital needs – these start-up ideas need to be funded to really grow their companies. We’ve got great potential with start-ups in northwest Arkansas,” Malone added.