State joblessness rate holds at 3.8%

Arkansas, U.S. joblessness rates
Arkansas, U.S. joblessness rates

Arkansas' unemployment rate remained at 3.8 percent in April, the third-consecutive month at that level, the U.S. Bureau of Labor Statistics said Friday.

The national unemployment rate was 3.9 percent in April.

There were 6,100 more nonfarm payroll jobs in Arkansas in April compared with a year earlier, but that total is deceptive, said Mervin Jebaraj, director of the Center for Business and Economic Research at the University of Arkansas, Fayetteville.

All of that job growth occurred in three metropolitan areas -- Northwest Arkansas, Little Rock and Jonesboro, Jebaraj said.

Northwest Arkansas added 6,600 nonfarm jobs from April to April, Little Rock grew by 2,200 jobs and Jonesboro added 1,200 jobs, Jebaraj noted. That exceeds the 6,100 jobs added statewide, he said.

So the rest of the state, including the other metropolitan areas and the rural areas of the state, is losing jobs, Jebaraj said.

That is unlike the job growth from as recently as November, when the state saw the addition of 9,500 jobs compared with a year earlier, Jebaraj said. That was spread generally throughout the state.

Friday's report was "another in a string of somewhat disappointing reports," said Michael Pakko, chief economist for the Arkansas Economic Development Institute at the University of Arkansas at Little Rock.

"Basically, it contributes to the trend of what seems to be a slowing job market," Pakko said. "I wouldn't say we're in any danger of experiencing a downturn or a contraction, but both the household and payroll surveys seem to be indicating a slowdown from the pace we had two or three years ago."

The payroll jobs and the labor force are calculated from two different monthly surveys.

Arkansas' labor force and unemployment rate are calculated through a survey of about 800 households in the state. Nonfarm payroll jobs are determined from a more comprehensive poll of thousands of Arkansas employers who are asked about the size of their workforces.

The number of employed Arkansans was down by about 1,400 compared with March and down by almost 3,000 compared with April last year.

The number of unemployed Arkansans was up by almost 2,700 from a year earlier.

The fact that the unemployment rate is so low could be a contributing factor, Pakko said.

"With the pool of those actively seeking employment being so small that it is perhaps not surprising that we're not seeing continuing job gains," Pakko said. "Then we'd have to see people either coming back to the labor force or through migration -- coming to the state -- for us to be seeing big gains in employment. We're not seeing those things happen in any large-scale way."

Overall, any unemployment rate of 4 percent or below is good, Pakko said.

"You've got to consider that pretty close to full employment," Pakko said.

Full employment is the state of the economy where all who are able and willing to work are employed.

There were five industrial sectors with an increase in jobs and six that saw a drop in jobs.

The professional and business services sector gained 4,100 jobs from April last year. Manufacturing jobs were up 3,100 jobs from April last year, with gains in both durable and nondurable goods.

"[Manufacturing] has definitely had a break from the trend that prevailed for several years, which was a contraction," Pakko said. "Some of that was because of automation. We're still producing a lot of goods in the manufacturing sector in Arkansas but it is not producing as much employment as it once did."

Construction lost 800 jobs from April to April, one of only 12 states in the country to show a job decline in construction, according to The Associated General Contractors of America.

Two job sectors that have been providing much of the job growth are slowing down, Pakko said. Those two are the educational and health services sector, which lost 100 jobs from April to April, and the leisure and hospitality sector, which lost 700 jobs over that same period.

Hawaii had the lowest unemployment rate in the country in April at 2.0 percent, followed by North Dakota and New Hampshire at 2.6 percent each, Maine at 2.7 percent, and four states tied at 2.8 percent -- Iowa, Nebraska, Virginia and Wisconsin.

Alaska had the highest unemployment rate at 7.3 percent, followed by New Mexico and West Virginia at 5.4 percent each, and Arizona and Nevada at 4.9 percent each.

Business on 05/19/2018

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