Unemployment rate in state dips to 3.4%

Arkansas’ unemployment rate dropped to an all-time low in July, the second-consecutive record month, as the state continues to see steady job growth, according to a report released Friday.

The state’s unemployment rate fell for the third-consecutive month to 3.4% in July, down from 3.5% in June and down two-tenths of a percentage point from 3.6% for July of 2018, according to data from the U.S. Department of Labor released by the Arkansas Department of Workforce Development.

Arkansas economists said in Friday interviews that the unemployment rate for July

will be an all-time low if the data remains unchanged but cautioned with preliminary figures, the rates can be adjusted at a later date.

The U.S. unemployment rate was 3.7% in July, steady compared with June and down two-tenths from July of 2018. According to the Bureau of Labor Statistics, 14 states had unemployment rates lower than the U.S. rate, eight states and the District of Columbia had higher rates, and 28 states had rates similar to the U.S. rate.

Greg Kaza, executive director of the Arkansas Policy Foundation, said in a statement that it is very good news when the state’s unemployment rate hits record lows in consecutive months.

Mervin Jebaraj, director of the Center for Business and Economic Research at the University of Arkansas, Fayetteville, agreed, adding that employment in the state had slowed some in July with the labor force essentially unchanged in recent months.

Michael Pakko, chief economist at the Arkansas Economic Development Institute at the University of Arkansas at Little Rock, said the unemployment data show modest but positive growth for the state.

Vermont reported the lowest unemployment rate at 2.1 percent in July, and Alaska reported the highest at 6.3%. Arkansas wasn’t the only state to set a record low, with Alabama and New Jersey reporting record unemployment at 3.3% for July and Maine 3%, since comparable record-keeping started in 1976. In July, only six states, including Arkansas, reported lower monthly unemployment rates, two had higher rates, and the rate was unchanged in 42 states and the District of Columbia.

Arkansas added 802 jobs in July, bringing the number of employed to 1,316,265 for the month. The state has added 15,625 jobs since July 2018. There were 46,902 unemployed workers in July, down 392 workers from last month and 2,253 lower compared with July of last year.

Nonfarm payroll jobs were down 13,900 to 1,265,100 for July from June. Seven major sectors showed losses, primarily attributed to seasonal unemployment, with four seeing gains. Government saw the biggest drop with 11,200 jobs, pegged to breaks at schools and universities for summer. Manufacturing saw a loss of 1,500 jobs, and education and health services dropped 14,000. On the plus side, the financial-activities segment posted the most gains, adding 1,000 jobs, along with finance and insurance with a gain of 700 jobs and real estate rental leasing adding 300 jobs.

Kaza said the professional, scientific and technical jobs subsector — a component of the professional and business services sector — added 800 jobs in July, the largest gain of any component. He said the shift makes the subsector worth watching going forward as Arkansas works to diversify its economy.

When compared with last year, nonfarm payroll jobs in July were up 19,200, a 1.5% gain. Nine sectors saw improvement from the same month last year, with the leisure and hospitality sector seeing the greatest gain with 7,000 jobs. Construction saw an increase of 2,800 jobs; trade, transport and utilities added 2,400 jobs; and manufacturing added 2,000. Mining and logging remained flat, and the information sector saw a slight decline.

The UA’s Jebaraj said the year-over-year growth was exceptional for July with similar gains not seen in years.

For the month of July, five states saw nonfarm payroll jobs increase when compared with June, with the largest gains seen in Texas, Florida and Washington. When compared year-over-year, 25 states saw gains in nonfarm payroll jobs, with Texas seeing the greatest increase, followed by California and Florida.