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Arkansas' unemployment rate dropped to 5.4 percent in August, down from 5.6 percent in July, the U.S. Bureau of Labor Statistics said Friday.

The national unemployment rate in August was 5.1 percent.

Arkansas' rate in August was the lowest since July 2008, when it fell to 5.3 percent.

The lowest the unemployment rate has dipped in the past 25 years was 4.2 percent, where it stood for six months from April to September 2000. The rate fell below 5 percent for 30 consecutive months from January 1999 to June 2001.

Even though it isn't close to a historical low for Arkansas, the lower unemployment rate in August is welcome, said Michael Pakko, chief economist at the Institute for Economic Advancement at the University of Arkansas at Little Rock.

"It's nice to see it going down," Pakko said. "It's getting down to the range of full employment."

Full employment is the state of the economy where all eligible people who want to work can find work at prevailing wages. The Congressional Budget Office considers full U.S. employment to be 5.4 percent.

The state's civilian labor force, which includes the number of Arkansans employed and those seeking work, grew by 38,500 since August 2014.

There were 3,900 more Arkansans employed than in July and 43,400 more than in August of last year.

It was the 21st consecutive month that Arkansas' employment level increased, said Susan Price of the Arkansas Department of Workforce Services.

Another bit of good news was that nonfarm payroll jobs also increased, said Greg Kaza, executive director of the Little Rock-based Arkansas Policy Foundation.

The number of nonfarm payroll jobs grew by 25,300 since August of last year, but the pace of growth is below the country's growth rate, Kaza said.

The country's payroll jobs have grown by 8.5 percent since June 2009, when the recession ended. Arkansas' payroll jobs have grown by 4.6 percent, Kaza said.

The decline in the unemployment rate and the increase in nonfarm payroll jobs both indicate a "pretty healthy expansionary phase" of the Arkansas economy for the past two years, Pakko said.

"Even with revisions, which always happen, I'm not expecting to see any significant change in the trends we're seeing," Pakko said.

Seven industry sectors saw yearly job gains and four had declines.

The professional and business services sector -- which includes a wide range of jobs from some temporary workers to attorneys -- had the biggest one-year increase in jobs at 8,200.

"That has definitely been one of the strongest sectors," Pakko said.

The professional and business services sector has added 29,000 jobs since June 2009, Kaza said.

"All the service sectors have been growing at least modestly, but the continued disappointment has been manufacturing," Pakko said.

Professional and business services reported 140,700 jobs in August and is on its way to surpassing manufacturing as the fourth-largest sector in the state, Kaza said.

The manufacturing sector lost 1,900 jobs from August 2014 and had a total of 153,100 jobs last month.

Manufacturing was once the largest sector in the state, Kaza said. It peaked in jobs at 247,300 in February 1995 and has since lost more than 94,000.

"The decline that we've seen in manufacturing is far more than just cyclical," Pakko said. "It's a longer-term trend. We're still producing manufactured goods but with a lot higher productivity and fewer workers involved in the process."

Nationally, Nebraska had the lowest unemployment rate in August at 2.8 percent, followed by North Dakota at 2.9 percent, Hawaii at 3.5 percent, and New Hampshire and Vermont at 3.6 percent each.

West Virginia had the highest rate at 7.6 percent, followed by Nevada at 6.8 percent, New Mexico at 6.7 percent, Alaska at 6.6 percent, and Arizona and Mississippi at 6.3 percent each.

Twenty-nine states reported declines in unemployment rates compared with July. Ten states saw increases, and 11 were unchanged.

Business on 09/19/2015

Print Headline: Unemployment rate in state falls to 5.4%


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