Number of unemployed rises 37.4% in March, jobless rate rises to 4.8%

The number of unemployed in Arkansas’ March jobs report rose 37.4% year-over-year, and was up 38.7% compared to February. The March report shows the initial impact of COVID-19 on the economy. The state’s jobless rate was 4.8% in March, well above the 3.5% in February and March 2019.

The number of employed in Arkansas during March was an estimated 1,320,420, up 6,747 jobs compared with March 2019, according to the U.S. Bureau of Labor Statistics (BLS) report posted Friday (April 17). The state’s labor force – the number of people eligible to work – was 1,386,748 in March, up 1.8% compared with the 1,361,942 in March 2019.

The March numbers are preliminary and subject to revision. Sudden changes in employment status caused by the COVID-19 outbreak also caused federal officials to adjust calculations in the March report.

“Due to the unprecedented nature of the COVID-19 outbreak, changes were made to the models that calculate employment and unemployment across the country,” Susan Price, BLS program operations manager with the Arkansas Department of Workforce Services, said in a statement. “The increase in the number of unemployed Arkansans is, in large part, a reflection of the number of unemployment insurance claims filed during the week of March 12. The small gain in employment is based largely on a monthly survey of Arkansas households, which was significantly impacted by the outbreak.”

The BLS report included this caveat: “In the establishment survey, workers who are paid by their employer for all or any part of the pay period including the 12th of the month are counted as employed, even if they were not actually at their jobs. Workers who are temporarily or permanently absent from their jobs and who are not being paid are not counted as employed, even if they continue to receive benefits.”

Arkansans without jobs in March totaled 66,328, higher than the 48,269 in March 2019 and the 47,802 unemployed in February.

Sectors with the biggest year-over-year gains were Professional and Business Services (3,300 new jobs), Education and Health Services (1,000) and Trade, Transportation and Utilities (1,000). Sectors with the biggest year-over-year losses were Manufacturing (3,900), Leisure & Hospitality/Tourism (3,800) and Government (1,300).

Greg Kaza, an economist and director of the Arkansas Policy Foundation, noted that the jobless rate increase is the largest when compared to previous recessions.

“Today’s reported increase (1.3%) in the Arkansas unemployment rate, from 3.5 percent (February) to 4.8 percent (March) was significantly greater than any monthly reading in this century’s two previous recessions (March 2001-November 2001, December 2007-June 2009). In the first recession, Arkansas’ unemployment rate increased from 4.7% (March 2001) to April 2002 (5.6%), with the rate slowly increasing in 1/10th percent increments each month. The greatest monthly increase in the second recession occurred from November 2008 (6.4%) to December 2008 (6.8%), a 4/10ths of a percent increase,” Kaza explained in a note to Talk Business & Politics.

Unemployment rates were higher in March in 29 states and the District of Columbia, lower in 3 states and stable in 18 states. Twenty-three states had jobless rate increases from a year earlier, 3 states had decreases and 24 states and the District of Columbia had little or no change. The U.S. rate was 4.4% in March, up from 3.8% in March 2019. North Dakota had the lowest unemployment rate in March, 2.2%, while Louisiana had the highest rate at 6.9%.

JOB SECTOR CHANGES
Jobs in the Trade, Transportation, and Utilities sector – the state’s largest job category – was 253,300 in March, unchanged from February and up from the 252,300 in March 2019. December employment of 254,700 set a new record for the sector.

The Government sector employed 210,400 in March, unchanged from February and below the 211,700 in March 2019. Sector employment hit a peak of 224,100 in May 2010.

The Education and Health Services sector employed 194,300 in March, down from 197,600 in February and above the 193,300 in March 2019. February set a record for sector employment.

Arkansas’ manufacturing sector had 158,900 jobs, down from 160,200 in February and down from the 162,800 jobs in March 2019. Manufacturing, once the state’s largest jobs sector, has shed 88,700 jobs – down 35.8% – since reaching a record of 247,600 in March 1995. The sector reached a low of 152,000 jobs in July 2013.

Professional and Business Services employed 148,800 in March, up from 147,000 in February and up from 145,500 March 2019. If it stands, the March employment set a record for the sector.

The state’s Leisure and Hospitality (tourism) sector had 116,000 jobs in March, down from 120,000 in February and below the 119,800 in March 2019. The sector reached a record for employment in July 2019 with 120,800 jobs.

The Financial Activities sector had 62,400 jobs in March, up from 62,400 in February and down from the 62,600 in March 2019. The sector hit record employment of 62,900 in August.