Jonesboro, Craighead County sales tax collections have waned, remain on record pace

City sales and use tax receipt collections in the Jonesboro metro area were slightly higher in October than in 2015, but the trend slightly dipped as fall began.

Jonesboro has collected $14.482 million in sales and use tax receipts this year, a 5% increase compared to the year before. In October, the city collected $1.4 million, a 2% increase compared to October 2015, but it dropped the yearly increase by two-tenths of a point. The October report reflects tax collected on August sales.

“I can’t really see any downside to higher sales tax numbers,” Arkansas State University economics professor Chris Brown told Talk Business & Politics. “It shows the public is spending and has the ability to spend money.”

City sales and use taxes are almost $500,000 more than budget expectations, a gain of 3.5%.

Craighead County displayed similar trend lines. The county collected $16.102 million in county sales and use tax this year, a nearly 5.1% increase from the year before. The county is easily on pace to crush its previous annual collection record of $18.4 million set in 2015.

Another primary economic indicator, employment, has shown growth this year in the metro area, Brown said. Jonesboro’s unemployment rate in August was 3.1%, nearly eight-tenths of a point lower than at the first of the year, according to the U.S. Bureau of Labor. More than 35,668 were employed in the city, a 3.3% increase from January.

Craighead County’s unemployment rate and drop were identical to the city’s during the first eight months of the year. At least 51,016 county residents had jobs as of August, a 3.3% increase from January.

Sales tax numbers and employment rates are positive, but there are still economic issues that affect the economic health of the region, Brown said. The median household income in Jonesboro in 2015 was less than $41,000 according to the U.S. Census Bureau. The median household income national average was $55,775 in 2015, a 37% disparity.

Northeast Arkansas’ blend of light manufacturing, food processing, educational, agricultural, health, retail, and food service jobs insulate it from the fluctuations of the national economy, Brown said. But the lack of heavy industry, white collar, and technology jobs hurt wage growth, he said.

Solving those problems could be difficult, he said. There are entire buildings in Dallas, Memphis, Chicago, and other major cities are filled with high paid administrators and others who run major corporations. These “corporate hubs” are found in places that have easy airport access and readily available college graduates, he said. A prime example in Arkansas would be the Northwest sector where Wal-Mart Stores, Tyson Foods, and other major companies are located.

Arkansas ranks near the bottom among all states in the number of residents who have a college degree, and the Mississippi Delta Region, which includes Northeast Arkansas, has some of the lowest college graduate rates in the entire country, he said.

Attracting a heavy industrial prospect, or landing a major technology firm would also be difficult, he said. Those companies tend to stay in or neat cities with other major businesses, he said.

However, sales tax receipts continue to rise, and the unemployment rate continues to decline – two dynamics many communities around the country would love to have.

“We have a very diversified economy and we need to continue to build on that,” he said.

JONESBORO TAX COLLECTION HISTORY
2015: $16,591,429
2014: $15,880,099
2013: $15,371,377
2012: $15,022,633
2011: $14,532,544
2010: $13,935,103
2009: $13,953,276
2008: $14,388,497
2007: $13,378,813
2006: $13,070,246