Northwest Arkansas' job market bounced back much faster than the national average, taking a year and a half to recover the number of jobs lost after the 2008 recession hit. The nation as a whole still has not made up for the jobs lost, figures from the federal Bureau of Labor Statistics show.
However, the mix of jobs in Northwest Arkansas changed, according to those federal figures. An economy built on manufacturing, transportation and construction before 2009 shifted into one where government, school, retail and management jobs came to the fore.
Health care-related jobs are the fastest-growing sector, figures show.
Overall, trends show a shift toward careers requiring higher education, though not all require college degrees, said economic analysts at the Northwest Arkansas Council and the University of Arkansas. The council is a nonprofit group of business, political and community leaders who focus on regional issues.
Government now employs more people in Northwest Arkansas than any other sector, once public school and university employees are factored in, labor statistics show. This happened despite slow growth in the sector. Faster-growing sectors such as retail and health-related fields started from a smaller base of workers while the once-larger manufacturing workforce declined.
The number of government employees in the region per capita remains below the national average, figures show.
"A lot of that government growth is in education, which is a response to other growth," said Michael Harvey, chief operating officer of the Northwest Arkansas Council. As the number of students went up, the number of teachers and other staff in public schools went up, he said. A similar trend occurred at the University of Arkansas, where enrollment has boomed in recent years.
The government employment figure includes all the city governments and the university, Harvey said. The demand for services has gone up but the number of people providing those services remained relatively low.
Falling tax revenues forced cities and other government bodies to be more efficient, said Mayor Doug Sprouse of Springdale. Revenue from sales and property taxes still has not recovered to prerecession levels, said Sprouse, who is both the chief executive of his city and a private businessman with a furniture re-upholstering business.
Springdale turned to technology such as iPads and tracking devices for many city tasks such as code enforcement that used to be done by more laborious, paper-based methods, Sprouse said.
The city also reorganized, consolidating departments and making other changes when possible. City administrative costs were never lavish, he said, but any tendency to grow in the public sector was kept in check by both falling tax revenue and changes to the state sales tax.
Those 2007 changes, which saw some of the city's sales tax revenue go to "point of delivery" instead of staying in the city where the sale was made, came just before the revenue drop of the recession.
"That change has cost Springdale $3 million a year for six years now, about $18-or-19 million," Sprouse said.
"People don't really have that feeling that we're out of the woods yet," Sprouse said of the private sector. The local economy is improving, he said.
He can tell "because my business does better in a recession," he said. "People buy new furniture when times are good and they can get credit."
Retail sector jobs have bounced back after a decline from their previous 2007 peak. The retail sector has edged out the manufacturing job base for second place, figures show. Yet manufacturing here fared better than the rest of the country as a whole. The region has almost one and a half times as many manufacturing jobs as a portion of its economic base, compared to the rest of the country.
"If you just glance at those figures, you wouldn't give a second look to a career in manufacturing, but there is a big demand here for production-oriented skilled employees," Harvey said. "That decline isn't caused by a decline in manufacturing. It's caused by a reduction in the number of people you have to hire to produce the same amount. It's caused by efficiency. The trained, skilled workers in manufacturing now are in big demand."
That demand will increase, Harvey said.
"When you look at the really experienced people in manufacturing with the skills, they're a bunch of gray-haired guys," he said. Someday, they will have to be replaced.
"Half of that is food," Harvey said of the manufacturing sector. "It's getting more and more efficient, and you don't ship food jobs to places like China. Food jobs don't go overseas."
The fastest growing sector in the local economy is health and social service related jobs, figures show. The pace of growth in that sector barely slowed during the recession.
There is a growing demand for medical services as the average age of the population increases, said Paula Maxwell, chief operating officer for Medical Associates of Northwest Arkansas. MANA is an independent physician group based in Bentonville.
Besides direct patient care, growing fields include laboratory technicians and trained workers who can correctly record patient information in specific medical codes, vital to billing and record keeping driven by government requirements, Maxwell said.
In another fast-growing segment, the region now has seven times as many business executives per capita as the national average, figures show. That's a combination of corporations headquartered in the region and vendors, the high-ranking executives sent to the region by suppliers of Walmart Stores Inc. The steepest increases came after 2011. Hotel and food service industries also show a growth trend.
Transportation services showed a steep decline from a 2007 peak, but is recovering as the national economy recovers.
Construction jobs collapsed from a 2006 peak of more than 19,500 to less than 14,000 at the end of 2013. Yet even construction began to show a rebound in 2013.
"It will be years before we have that kind of construction -- if ever, to be honest," Harvey said. He noted the region is still slightly ahead of the national average in jobs in the construction sector, a sign of how the "housing bubble" collapse was far more serious elsewhere.
While the recession pounded the transportation and construction sectors, particularly home builders, the survivors are a strong and experienced group, Harvey said. The will recover quickly when trends flow their way "across the board," he said.
"I consider myself one of the more fortunate economic development guys in the country," Harvey said of the region's job market.
NW News on 03/23/2014