Arkansas' unemployment rate slipped to 3.8 percent in May, the lowest since records dating to 1957, the U.S. Bureau of Labor Statistics said Friday.
The state's unemployment rate was 3.9 percent in April. The national unemployment rate was 4.7 percent last month, down from 5 percent in April.
For 28 straight months, since January 2014, there hasn't been an increase from the previous month in the state's unemployment rate, said Michael Pakko, chief economist at the Institute for Economic Advancement at the University of Arkansas at Little Rock.
"Over two years the unemployment rate has been trending down," Pakko said.
May's unemployment rate was "another spectacular reading," said Kathy Deck, director of the Center for Business and Economic Research at the University of Arkansas at Fayetteville.
"The longer we see these very low unemployment rates, the more we trust that it's not a fluke," Deck said. As long as the national economy is performing well, so should the Arkansas economy, she said.
"It would be very difficult for Arkansas to continue to see unemployment this low if the national economy weakens a bit," Deck said. "There are pressures that are external to the state right now that will affect the unemployment rate."
The number of unemployed in Arkansas fell to 51,773 in May, Susan Price, a spokesman for the Arkansas Department of Workforce Services, said in a prepared statement.
"The number of unemployed has been on a steady decline since February 2011 when unemployment was at a record high of 114,892," Price said.
The last time the number of unemployed fell to a cyclical low was in 2006, Pakko said. At the time, the unemployment rate was 5 percent, he said.
But the employment-to-population ratio -- expressed as the percentage of the civilian population age 16 and older who are counted as employed -- was about 64 percent then, Pakko said.
Now, with the unemployment rate below 4 percent, Arkansas has an employment-population ratio of just over 56 percent, he said.
"So the percentage of Arkansans with jobs is presently 8 percentage points lower than it was a decade ago," Pakko said.
There are various reasons why the ratio is lower now than 10 years ago, Pakko said. Many in the baby boomer generation are retired, some potential workers are on disability, some have taken early retirement, some have returned to college, and some are seeking job training. But some who are in the prime working ages of 45 to 50 have just dropped out of the labor force, Pakko said.
Deck said the labor force in Arkansas is expanding faster than the state is accustomed to seeing.
"Yes, the employment population and the labor force participation rate are much lower than they were prior to the recession, but it is improving," Deck said.
Deck noted that most of the regions of the state are showing gains as well.
Two regions of the state had April unemployment rates below 3 percent -- Northwest Arkansas at 2.4 percent and the Jonesboro metropolitan area at 2.8 percent. May rates have not yet been released for metropolitan areas.
Nine of the 11 industry sectors in the state added jobs.
"We're seeing very, very strong numbers across almost all sectors with the notable exceptions of [the mining and logging sector] and manufacturing," Deck said.
Mining and logging recorded a loss of 1,500 jobs from May 2015 to last month. Manufacturing lost 400 jobs over the same period.
It will be interesting to see how some major manufacturing facilities that are scheduled to open soon will affect manufacturing employment, Deck said.
The biggest project in the state now is Big River Steel, a $1.3 billion steel mill being built near Osceola. It is expected to create more than 500 jobs when it opens next year.
But that area of the state -- Mississippi County -- has about 1,000 manufacturing workers laid off in the oil and gas industry, said Clif Chitwood, economic development director for the county.
Mississippi County's unemployment rate was 5.8 percent in April, the second-highest rate in the state. It was 7.7 percent in February with almost 1,380 unemployed.
Deck said that all the service sectors are doing well.
The educational and health services sector added 7,000 jobs compared with a year ago, and the trade, transportation and utilities sector saw 6,900 additional jobs.
Much of the growth in the state is in the private sector, where there was better than 2 percent growth in May, said John Shelnutt, administrator for economic analysis and tax research for the state's Department of Finance and Administration.
The state with the lowest unemployment rate in May was South Dakota at 2.5 percent, followed by New Hampshire at 2.7 percent, Vermont at 3.1 percent, and Hawaii and North Dakota at 3.2 percent each.
Alaska had the highest rate at 6.7 percent, followed by Illinois at 6.4 percent, Louisiana at 6.3 percent and New Mexico and West Virginia at 6.2 percent each.
A Section on 06/18/2016