Employment Shows Seasonal Dip

Year-Over-Year Improvement Continues

Unemployment rose slightly in May for the Northwest Arkansas metro area, but the employment outlook improved year-over-year.

About 1,000 residents went from having a job in April to being unemployed in May, according to data from the federal Bureau of Labor Statistics. The unemployment rate for the metro area was 5.7 percent in May, up from 5.3 percent in April but down from 6.1 percent a year ago. The labor force, which includes all those who have a job and those looking for work, did not change from April to May.

Analysts said the April to May fluctuation is seasonal and has shown up every year for at least a decade. The same has been true on the state and national level.

“It’s down a little from last month, but it’s still better than last year. I think it’s most important to look at where we are this May as compared to last May,” said Kathy Deck, director for the Center for Business and Economic Research at the University of Arkansas. “We saw improvement in every single metro in Arkansas over employment rates this time last year.”

Deck said labor force data show year-over-year improvement in every category.

“We saw the labor force rise by 8,047 people. We saw employment increase by more than the increase in the labor force, 8,528 people,” Deck said. “We saw unemployment drop by 481 people. And, the unemployment rate in May of last year was 6.1 percent and the rate is 5.7 percent now.”

In the various employment sectors, leisure and hospitality and education and health services continue to add jobs. Professional and business services was down slightly from March and April numbers but grew substantially year-over-year, at 2.8 percent.

Construction was up a bit, at 1.3 percent, with public projects contributing heavily to the increase.

“We’re up about 5 percent from last year, in the industrial markets primarily and some new construction,” said Rick Barrows of Multi-Craft Contractors in Springdale. “We’re doing quite a bit of work down at the university; we’re doing the Fayetteville schools, the Springdale hospital; we’re working some out of state.”

The weakness continues to be in manufacturing, information and financial activities sectors.

In the government sector, local and state jobs were up, while federal jobs were down.

“If we look at local government from May to May, there was an increase of about 400 jobs and at the state level an increase of about 600 jobs, but at the federal level there was a loss of 100 jobs,” Deck said. “The state’s fiscal position has been relatively strong through this, and we’ve been seeing relatively strong sales tax collections across Northwest Arkansas. That’s going to give the local governments some flexibility in their budgets and the ability to actually hire.”

Other services, which is a relatively small catch-all sector of service-related work, added about 300 jobs year-over-year.

“They include jobs you can’t put anywhere else,” Deck said. “Car repair, dry cleaners, nail salons, things that are not traditionally retail but where you buy a service that’s not a lawyer or accountant.”

Financial activities, banking and real estate, is basically at the level it was in 2003, about the time the building boom began in Northwest Arkansas.

“From 2003 up through 2007 financial activities grew substantially with the real estate boom here in Northwest Arkansas and since that time financial activities had been shedding jobs fairly consistently,” Deck said. “We’ve been at about the same level of employment for a year for so. That other services sector is now bigger than financial activities. There are 7,200 people in other services right now and there are just 7,000 in financial activities. At the peak in financial services there were 8,900.”

By The Numbers

A Bump in the Road

The unemployment rate has fluctuated from 5.3 to 7 percent during the past 13 months in Northwest Arkansas.

  • May 5.7
  • April: 5.3
  • March: 5.7
  • February: 6.4
  • January: 6.2
  • December: 5.6
  • November: 5.5
  • October: 5.9
  • September: 6.3
  • August: 6.6
  • July: 6.9
  • June: 7
  • May 2011: 6.1

Source: U.S. Bureau Of Labor Statistics

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