Northwest Arkansas' low unemployment falls lower still

Northwest Arkansas' already low unemployment rate ticked down another notch in March to the lowest level in a decade, according to the U.S. Bureau of Labor Statistics.

Last month 2.9 percent of the labor force didn't have a job in the metropolitan statistical area, according to the bureau's preliminary report. That's about 7,600 people out of work, the fewest since December 2006. Northwest Arkansas' metropolitan statistical area includes Benton, Washington and Madison counties and McDonald County, Mo.

By the numbers

Northwest Arkansas unemployment

March’s rate is the latest piece of a yearslong downward trend.

• March 2011: 6.6 percent

• March 2012: 6 percent

• March 2013: 5.7 percent

• March 2014: 5.2 percent

• March 2015: 4.2 percent

• March 2016: 2.9 percent

Source: U.S. Department of Labor, Bureau of Labor Statistics

March was also the first time since late 2005 the unemployment rate dipped below 3 percent.

The falling numbers are in some ways a mixed blessing thanks to competition and the demands on today's workers, according to employment experts. More people have jobs and income, which could eventually push up wages, but low unemployment can also leave employers struggling to fill positions with qualified people.

"There's more jobs than there are people that have the qualifications," said Lisa Butler, an account manager in Bentonville with the recruiting company Staffmark. If prospective employees aren't hired within a day or so of coming in to the office, they've already been placed elsewhere, she said.

"People that would not ever think of leaving their jobs are coming in for positions," Butler added. "They know they're out there, and if they're not currently happy with their pay or shift, they know there's 15 other employers that are interested."

The state's unemployment in March came in at 4 percent, the lowest in almost six decades, according to the bureau. The country's rate was 5.1 percent. Northwest Arkansas' rate ties it for ninth lowest out of more than 380 metropolitan statistical areas across the country.

Northwest Arkansas' unemployment has gradually fallen from a post-recession peak of 7.5 percent in January 2011, when almost 17,000 people weren't working. The area's workforce in March topped 260,000 for the first time.

The falling unemployment rate could mean the workforce grows even quicker, said Kathy Deck, director of the center for Business and Economic Research at the University of Arkansas. Those who left the workforce, such as parents caring for children, may be drawn back in, and more people will move to the area in a feedback loop of more and more jobs, services and benefits throughout the community.

"If I'm an employer and I look around, and I have a job opening, and everybody's already employed, I've got to offer them a better deal to get them to come work for me," Deck said. "If you're a business, however, it makes it really tough to get people at a price you can pay and still make a profit."

Deck said wage pressure will begin to grow quickly with the low unemployment rates, although it can take months or years to show itself in better pay.

Cameron Smith, president and founder of executive recruitment firm Cameron Smith & Associates in Rogers, said about 8,000 people work in the supplier community within a three-mile radius of the Wal-Mart headquarters in Bentonville. Many of those jobs are paying considerably more than five years ago, he said.

"Salaries have gone up because it's a war for talent," Smith said. "Everyone wants the best and the brightest."

Smith said salaries for top executives have leveled off after increasing about 20 percent over the past three years.

Area chambers of commerce and other economic development groups have worked for years to attract more people to the region and increase the workforce. Fayetteville's chamber plans to open a fabrication and robotics lab to encourage innovation and skill-building, for example. The chamber and Goodwill Industries of Arkansas are also holding two job fairs this week, including one today for Central Research in Lowell.

"That's a great problem to have, but it is a problem," said Steve Clark, president of the Fayetteville chamber. "You've got to grow your population, but you've got to grow your skill sets within your population."

NW News on 04/28/2016

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