ANDREW MOREAU

Inflation surpasses pandemic as region’s top economic threat

In Central Arkansas, we've apparently moved from the pandemic being the biggest threat to the region's economy to inflation taking over the top spot.

Last week, Metroplan, lead planning agency for the region's five counties, cited inflation as the region's top barrier to growth. "Inflation will be the key wild card for the year ahead," the report noted.

Central Arkansas, of course, is not alone. Inflation continues to escalate across the nation -- the nation's annual inflation rate accelerated in March to 8.5%, rising from 7.9% in February and the highest since December 1981. Inflation was 2.6% in March 2021.

Though the region has largely recovered jobs lost during the pandemic -- down only about 1,100 workers vs. the pre-pandemic period -- labor pool shortages remain a critical restraint on economic growth. The region's available workforce is down about 2% since the pandemic.

"Labor shortage is an emerging reality for employers in the post-pandemic economy," the report notes, adding that "workers are harder to find and keep these days."

The way out? Metroplan encourages employers to build long-term strategies to attract and keep workers -- no specifics are offered -- while at the same time integrating new technologies that can keep production rolling.

Earlier in April, the Federal Reserve Bank, in its Beige Book report, noted that industries have been successful in adapting new technologies although other problems such as supply-chain bottlenecks that tie up parts deliveries slow growth and production.

Overall, Central Arkansas lags behind the country in economic growth, the report said, though the region did outpace the nation in financial activities, education and health, and other services.

"The region's finance sector has been the most reliable provider of job growth over the past decade and correlates with a promising niche in [financial technology]," the report said, noting that regional economic development officials are moving to capitalize on the sector with an emphasis on increasing cybersecurity jobs.

In other areas, the report said:

• Federal money sent to consumers during the pandemic lifted retail sales in the region by nearly 11% last year though declines can be expected because the payments have dried up and inflation likely will sap spending.

• Housing costs remain a key advantage for Central Arkansas, where prices are about 75% of the national average.

• The region's population is growing more diverse as the Black and non-Hispanic population grew by 11% and now makes up nearly one-fourth of the area's population. The white population declined by 3.7% over the past decade.

Metroplan says the region is emerging from the pandemic in relatively healthy economic condition and could continue to grow by taking advantage of favorable housing costs. Danger lurks, however, with the uncertainty over inflation, the lingering labor shortage and the ongoing war in Ukraine.

SOLAR ICE

Imperial Ice is joining the list of Arkansas companies converting to solar power.

The Little Rock ice provider now has a 320-kilowatt solar array in England, a system that will produce enough power to offset energy usage and produce savings of $857,000 over the next 30 years.

Delta Solar of Little Rock built the system. "Electricity had been our largest cost, and we were looking at ways to lower that expense," said Imperial Ice owner Mark Enderlin. "Solar was the right solution, but we didn't have the room on our property to accommodate a system. Delta Solar provided an off-site location that allowed us to build an array and significantly lower our electric bill."

Imperial Ice is taking advantage of Arkansas' remote net-metering policy, which allows flexibility in where a solar array can be located. A system can be built anywhere within the customer's same utility service territory.

"We are always eager to help Arkansas entrepreneurs explore the benefits of solar technologies to their operations," said Douglas Hutchings, Delta Solar's chief executive officer.

SBA RECOGNITION

Seven small businesses in Arkansas are being recognized this week in various categories as part of National Small Business Week, which runs through May 7, and recognizes small businesses for their economic contributions.

"Our seven award winners epitomize the tenacity, diversity and community involvement that supports our economy and small businesses as we grow and recover," said Edward Haddock, director of SBA operations in Arkansas.

Here are the best of Arkansas:

Jaim Krutz, owner of Big Cuppa, a craft coffee shop and roastery in Morrilton, is the Arkansas small businessperson of the year. The Arkansas Small Business and Technology Development Center is being rewarded for excellence in innovation for providing economic development support and programming.

All Electric Supply of Little Rock has been named family-owned small business of the year for its work with nonprofits and support of other community businesses.

Latrobe of Port Arthur, Texas, founded by Stuttgart native Latanyua Robinson, is being recognized as minority-owned small business of the year. Latrobe plays a key role in supporting community and economic-development efforts throughout eastern Arkansas.

The veteran-owned small business of the year is Century 21 Sandstone Real Estate Group, which was established in Conway in 2008 as the first Black-owned full-service real estate franchise in Arkansas. Career Staffing Services Inc. of North Little Rock has been named female-owned small business of the year.

Looking to the future, Aidan Eslinger, now 16, is the Arkansas young entrepreneur of the year. He started his company in Mayflower at 8 years old and it now includes three separate entities that coach young writers, produce original content for customers and create activities and incentives to encourage young Black boys to read and engage in academics.

RENEWABLE AMAZON

Amazon's expansion in Arkansas includes a 100-megawatt solar farm in Union County, part of the company's worldwide commitment to renewable energy. Last week, the company announced 37 new wind and solar energy projects across the United States, and now has 310 renewable energy projects across 19 countries.

The projects are a move toward Amazon powering its global operations with 100% renewable energy by 2025 -- five years ahead of the company's original target of 2030.

Once operational, Amazon's 310 projects are expected to produce 42,000 gigawatt hours of renewable energy each year -- enough electricity output to power 3.9 million U.S. homes annually.

Column ideas or recommendations? Thoughts or musings that need pursuing? Contact me at amoreau@adgnewsroom.com or at (501) 378-3567.

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