Arkansas’ jobless rate falls to 3.7%, economist says number ‘misleading’

Arkansas’ jobless rate in October was 3.7% down from 4% in September and below 4% for the first time since March 2020 – the month the COVID-19 pandemic began to shutdown the global economy. The October rate is also better than the 5.6% in October 2020.

The number of employed in Arkansas during October was an estimated 1,303,039, up 43,680 jobs compared with October 2020, and just below the 1,303,413 in September, according to Friday’s (Nov. 19) report from the U.S. Bureau of Labor Statistics (BLS). The October numbers are preliminary and subject to revision.

The state’s labor force – the number of people eligible to work – was 1,353,559 in October, up compared with the 1,333,366 in October 2020, but below the 1,357,689 in September. Arkansans without jobs in October totaled 50,520, down from 54,276 in September, and down 31.7% from the 74,007 in October 2020.

The biggest year-over-year sector gains were in Professional and Business Services (9,100 more jobs), and Manufacturing (up 7,900 jobs). Of the large employment sectors, those with job losses was Government which had 3,000 fewer jobs year over year, and Construction with 2,000 fewer jobs.

Mervin Jebaraj, director of the Center for Business and Economic Research (CBER) in the Sam M. Walton College of Business at the University of Arkansas, said the jobless rate decline is “a little bit misleading” because the state’s labor force and number of employed remain below pre-pandemic levels. The state’s labor force hit a record of 1,372,291 in January 2020, and an employment record of 1,323,423 in December 2019. The jobless rate was 3.6% in December 2019. Also, the state’s labor force participation rate has declined from 58.2% in January to 57% in October. The October 2019 participation rate was 58.3%.

“We haven’t had a very good labor force participation rate in this state in 2021,” Jebaraj said.

Factors keeping people out of the workforce include the inability to find or afford child care, school disruptions and “a significant section” of the population retiring early during the pandemic, Jebaraj said.

Unemployment rates were lower in October in 28 states and stable in 22 states, according to the BLS report. Forty-five states had jobless rate decreases from a year earlier and five states were little changed.

California and Nevada had the highest unemployment rates in October at 7.3% each. Nebraska and Utah had the lowest jobless rates at 1.9% and 2.2% respectively. The rates in Georgia (3.1%), Nebraska (1.9%), Oklahoma (2.7%), Utah (2.2%), and West Virginia (4.3%) set new series lows. (All state series begin in 1976.) Also, 19 states had jobless rates lower than the U.S. figure of 4.6%, 16 states had higher rates, and 15 states had rates that were not appreciably different from that of the nation.

JOB SECTOR NUMBERS
Jobs in the Trade, Transportation, and Utilities sector – the state’s largest job category – was 255,400 in October, up from 253,300 in September and above the 252,500 in October 2020. The October number marks a record for the sector.

The Government sector employed 202,900 in October, down from the 203,300 in September and below the 205,900 in October 2020. Sector employment hit a peak of 224,100 in May 2010.

The Education and Health Services sector employed 188,400 in October, down from 187,400 in September and above the 186,300 in October 2020. February 2020 set a record for sector employment at 195,300.

Arkansas’ manufacturing sector had 161,800 jobs, above the 160,900 in September and up from the 153,900 jobs in October 2020. Manufacturing, once the state’s largest jobs sector, posted record employment of 247,600 in July 1995.

Professional and Business Services employed 148,200 in October, up from 147,900 in September and well above the 139,100 October 2020. The sector reached a high of 148,300 in August.

The state’s Leisure and Hospitality (tourism) sector had 114,800 jobs in October, down from 113,100 in September and above the 108,100 in October 2020. The sector first reached an employment record of 122,900 in December 2019.

The Financial Activities sector had 66,800 jobs in October, up from 66,600 in September and up from the 63,800 in October 2020. The October jobs number marked a new record employment for the sector.

The Construction sector had 51,700 jobs in October, up from 51,600 in September and below the 53,700 in October 2020. The sector reached record employment of 55,200 in January.