Northwest Arkansas' Labor Force Shrinks, Unemployment Rate Drops

July marked the fifth straight month Northwest Arkansas' labor force shrunk, even as employment grew and unemployment dropped from July 2013.

The U.S. Bureau of Labor Statistics reported Wednesday the number of people working or looking for work in the Metropolitan Statistical Area in July declined 1.5 percent to 233,700 people. However, the number of people working in non-farm jobs increased by 1.4 percent to 214,300. The unemployment rate was 5.3 percent compared with 6.3 percent in July 2013.

Northwest Arkansas' Metropolitan Statistical Area includes Washington, Benton and Madison counties in Arkansas and McDonald County, Mo.

Kathy Deck, director of the Center for Business and Economic Research at the University of Arkansas, said many things could be causing the labor force contraction including people retiring, returning to school, moving out of the area or just giving up looking for a job.

She cautioned these numbers are preliminary and it's impossible to tell the whole story by one report.

"Unfortunately we have to wait for the population numbers to come out in the spring of 2015 to see what is happening," she said.

Mike Harvey, chief operating officer of the Northwest Arkansas Council said there's no indication the area's population is shrinking.

"I hope we don't have discouraged workers here. There are opportunities out there," he said. "It might just take a willingness to reinvent yourself."

He said some of the nearly 750 local workers affected by factory shutdown announcements by Apex Tool Group and Superior Industries International may have to look into new employment areas. Superior is closing its Rogers plant by year's end, and Apex is closing its Springdale plant by the end of 2015.

"We won't see those lost jobs reflected in the numbers until next year," he said. "The slow shutdown allows for people to look for new jobs or get new training."

Deck said she is surprised one of the area's strongest industries shed about 800 jobs in the past year.

"What is holding our numbers back is the transportation sector that is weaker than it has been in Northwest Arkansas," she said. "These numbers too are likely to change."

Carrie Johnson, a spokeswoman for J.B. Hunt Transport, declined to comment when asked if the company was downsizing. The national trucking firm had 2,796 people working in Lowell at the end of 2013.

Jay Hicks said he 's not seeing shrinkage in the trucking industry. He's owner of Simba Seven, a Springdale-based driver-placement and freight-brokerage firm. The company helps find drivers for about 50 of the country's largest trucking firms.

"The need for transportation is still there," he said. "I don't have enough agents working to find the drivers. I am hiring new people all the time."

Hicks has about 30 full-time employees in Springdale and hopes to grow his headquarters operations to about 150 people in the future.

"We could put 50 more people in the office right now and still not be able to meet the need of what we are being asked to do," he said. "I want to grow my business at the right rate, and I'm ready to build a team and create jobs in Northwest Arkansas."