Arkansas jobless rate falls to 16-year low at 4.4%, just off all-time record of 4.2%

Arkansas’ job market got off to a strong start in 2016 as the state’s jobless rate fell three-tenths of a percentage point in January as more than 6,000 workers were added to the state’s growing labor pool, according to the figures released Monday (March 14) by the U.S Bureau of Labor Statistics (BLS).

However, the state’s closely-watched nonfarm payrolls dropped by a surprising 24,500 jobs as most of the state’s major job producing sectors saw substantial declines in January, which state Department of Workforce Services officials attributed to post-holiday workforce reductions and annual Labor Department revisions in civilian labor force estimates.

In January, Arkansas’ seasonally adjusted unemployment rate fell to a tidy 4.4%, down from December’s revised 4.7%. That revised tally means the state’s unemployment rate has declined a whopping six-tenths of a percentage point in the past two months, moving to levels not seen since December 2000.

“The number of employed in Arkansas rose 10,142 in January, adding to the civilian labor force and contributing to a three-tenths of a percent point drop in the unemployment rate. There are currently 36,167 more employed Arkansans than in January 2015,” said Susan Price, the BLS program operations manager at the state Department of Workforce Services.

The nation’s economy in February added 242,000 workers to the U.S. economy. Total nonfarm payroll employment rose by 292,000 and 151,000 in December and January, respectively, and the unemployment rate settled at 4.9% after stalling at 5% in October, November and December, Labor Department officials said.

ARKANSAS TOPLINE TRENDS
Arkansas’ jobless rate is now only two-tenths of a percentage point off the lowest seasonally adjusted unemployment rate (4.2%) since the state began keeping such records in 1976. Arkansas’ seasonally adjusted unemployment rate was at 4.2% for several consecutive months in the year 2000, state workforce officials said.

Overall, Arkansas’ civilian labor force increased a robust 6,146, a result of 10,142 more employed and 3,996 fewer unemployed Arkansans. The size of the workforce was 1.343 million, up 1.7% from 1.321 million in December 2014. The peak for Arkansas’ labor force was 1.376 million in August 2008.

In December, Arkansas’ jobless rate fell below to 5% for the first time since June 2001 as the state’s labor pool climbed to 1,337,500 in December and the unemployment rate fell to the now revised 4.7% from the previous 4.8%.

The number of employed in Arkansas during January was 1.283 million, better than the 1.272 million in December and 2.9% better than the 1.247 million in January 2015. The number of unemployed was an estimated at only 59,508 in the first month of 2016, well below the 63,504 in December, and 14,250 jobs below the 73,658 in the same period a year ago.

However, the closely-watched nonfarm payroll number was 1.208 million in January, down 24,500 from December as ten major Arkansas industries posted employment declines for the month. The nonfarm number topped the 1.2 million mark in December 2014, the first time since September 2008.

The nonfarm category does not include farm workers, private household employees, non-profit employees and “general government” employees. Investopedia estimates that the nonfarm category represents about 80% of the total workforce that contributes to national GDP.

The preliminary average monthly jobless rate in Arkansas during 2015 is 5.4%. Arkansas’ average jobless rate for 2014 was 6.1%, down 1.3% from the 7.4% average in 2013.

ARKANSAS ECONOMIC SECTOR CHANGES
Sectors leading the year-over-year gains were trade, transportation and utilities (+8,500), professional business services (+6,700), leisure and hospitality (+6,500), and education and health services at 4,900. meanwhile, the state’s mining sector, which includes the oil and gas sector, posted the largest loss at 1,700 jobs as due to “current economic conditions,” state labor officials said.

In the Trade, Transportation and Utilities sector — Arkansas’ largest job sector — employment fell from December’s all-time high with an estimated 254,300 workers in the labor pool, compared to 262,400 in December and well ahead of the 245,800 in January 2015.

The state’s fast-growing Education and Health Services sector hit a wall in January with a decline of 1,700 to 177,700. That compares with a strong 179,400 in January 2015. This sector has seen steady growth in the past decade, with employment in the sector up nearly more than 20% since November 2005.

Manufacturing jobs in Arkansas saw a slight decline after a surprising rebound in December as the number of blue-collar factory workers fell to 154,400, down 700 from 155,100 in December and 155,900 in January of 2015. Employment in the manufacturing sector fell in October to levels not seen since early 1968. Peak employment in the sector was 247,300 in February 1995.

Government hiring fell substantially from December’s 217,700. The number of local, state and federal government jobs in January fell by 6,200 to 211,300. That is almost level with 211,200 government jobs in Arkansas a year ago.

The construction sector employed an estimated 46,800 in January, down 2,700 from December’s strong 49,500 and just above the 45,900 level in the same period of 2015. The sector is well off the employment high of 57,600 reached in March 2007.

Arkansas’ growing tourism sector (leisure & hospitality) employed 110,900 in January, down 1,300 from 112,200 in December, but well above year ago levels of 104,400. The sector hit a record high in February with employment of 114,800.