On downward trend, Arkansas’ jobless rate falls to 7.1% in July

Arkansas’ unemployment rate dropped to 7.1% in July, continuing steady improvement over the past three months from a high of 10.8% in April when the coronavirus began shredding the economy.

Since the spike in April, the state’s jobless rate has dropped a full percentage point or more every month and has remained below the U.S. unemployment rate, which registered 10.2% in July.

The Arkansas Department of Workforce Services announced Friday that the state’s civilian labor force declined by 9,410 in July, with 14,272 fewer unemployed and 4,862 jobs added.

Gov. Asa Hutchinson noted the “good news in terms of our economic recovery,” in opening his daily covid-19 news conference Friday. “This means there are 14,000 more people working than there were at the beginning of July.”

In July, six employment sectors gained jobs while five others posted losses, with the biggest decline of 13,100 in the government sector. Those losses were attributed to summer break at public schools and were not traced to the pandemic.

The leisure and hospitality sector, where hotels and restaurants have been ravaged by the coronavirus, gained 900 jobs in July. The professional and business-services sector posted the largest gain, adding 1,200 jobs.

Month-to-month jobless declines indicate Arkansas could be on the road to recovery, according to Commerce Secretary Mike Preston.

“At the height of the pandemic in April, the unemployment rate hit 10.8%,” Preston said Friday. “We have seen a

steady decline since then, with the rate reported as 7.1% in July, just three months later.

“This is a good sign we are on the right track and I’m confident we’ll see this downward trend continue in the coming months.”

While there is progress, Little Rock economist Michael Pakko notes the recovery may be in neutral.

Statewide, nonfarm payroll employment growth slowed in July, he said, adding that Arkansas gained 49,100 jobs in May and June, but payroll employment was up only 1,600 jobs in July.

“We’re still seeing recovery from the jobs losses in March and April, but the pace of the rebound has slowed,” Pakko said. “So we may be looking at a plateau.”

Compared with July 2019, Arkansas has dropped 54,600 nonfarm payroll jobs.

Over that time, manufacturing lost 18,100 jobs, mostly in durable goods. Leisure and hospitality decreased 17,600 and food services dropped 13,400 jobs. Overall, government employment is down 9,500 jobs from a year ago.

Local economic development officials are encouraged by the job gains over the past three months.

“The July employment report represents more good news for our state’s overall economy,” said Jay Chesshir, chairman and chief executive of the Little Rock Regional Chamber of Commerce.

“This report certainly reflects the steady employment rebound we’ve witnessed over the last three months and gives us increased confidence the recovery will continue.”

On Friday, the Arkansas Legislative Council approved the state’s request for federal dollars to give unemployed workers an additional $300 in weekly benefits.

The state needs approval from the Federal Emergency Management Agency to receive the funding. The federal agency, directed by an executive order signed by President Donald Trump on Aug. 8, will distribute the money through its disaster-relief fund.