A report on the Northwest Arkansas region shows strong job growth but states the area still lags in adult education and is seeing slow progress in reducing poverty.
The 2013 State of the Northwest Arkansas Region Report, released Wednesday, indicates that while Northwest Arkansas took an economic hit in the recession that struck the nation in 2008, the impact was not as severe as in the rest of the country, and the region’s economic performance overall has returned to pre-recession levels.
Northwest Arkansas saw its employment grow 3 percent between 2011 and 2012, nearly twice as fast as the United States as a whole and five times faster than the state average. Between 2007 and 2012, the region’s total employment grew 1 percent,also faster than any peer region.
“We’re back on the growth path we were on before the recession hit,” said Kathy Deck, director of the Center for Business and Economic Research in the Sam M. Walton College of Business at the University of Arkansas.
The annual report measures the region’s economic performance and compares it with five metropolitan areas likely to compete with the area. The peer areas are Tulsa; Knoxville, Tenn.; Huntsville, Ala.; Omaha-Council Bluffs, in Nebraska and Iowa; and Kansas City, in Missouri and Kansas.
The report focuses on the metropolitan statistical area that includes Washington, Benton and Madison counties in Arkansas and McDonald County in Missouri. It was released by the UA’s center, along with the Northwest Arkansas Council, a nonprofit organization that promotes the region.
Michael Pakko, chief economist at the Institute for Economic Advancement at the University of Arkansas at Little Rock, said reports like the one released Wednesday are important recruiting tools, and while Northwest Arkansas compares favorably with its peers, there were clear areas for improvement.
“It was a level-headed assessment,” Pakko said of the report.
Northwest Arkansas has been more successful than the rest of the state in recovering from the recession in part because things were going so well before the bottom fell out. Pakko said the region, while hit harder by declining real-estate prices initially, has ridden strong pre-recession momentum and has come out on the other side in better shape than the rest of the state.
In issues of adult education and poverty, Northwest Arkansas still lags behind most of its peer regions, according to the report.
As of 2011, 27.8 percent of Northwest Arkansas adults had obtained a bachelor’s degree or higher, up from 25.6percent in 2007, and higher than the state’s 2011 average of 20.3 percent. Still, the region ranked nearly last amongst its peers, beating Tulsa with 26.3 percent but well below front runner Kansas City’s 32.9 percent.
The poverty rate for Northwest Arkansas in 2011 was 17.2 percent, up 2.2 percent from 2010 and below the state average of 19.5 percent. The rate in Northwest Arkansas is 3.1 percent higher than 2007.
Northwest Arkansas tied with Kansas City with the highest poverty rate increase among their peers for the 2007 through 2011 period.
Mike Harvey, chief operating officer of the Northwest Arkansas Council, said jobs brought to the region by companies like Serco, Inc., should help the region lower its poverty level. Serco, a British company recently awarded the federal contract to administer the roll-out of President Barack Obama’s health-care law, set up a hub in Rogers, adding 400 to 500 jobs.
He said more jobs that pay $12 to $14 a hour with full benefits and chance for advancement are what the region needs to reduce its number of people living in poverty.
“You can pull people up the ladder with jobs like that,” he said.
Business, Pages 25 on 09/26/2013