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Fri June 20, 2014
Arkansas May Unemployment Rate Drops
The rate of unemployment in Arkansas dropped from 6.6 percent to 6.4 percent during the month of May. It has also dropped more than a full percentage point since the same period last year, when it stood at 7.5 percent in May 2013.
While sectors like educational and health services displayed a lot of growth in May, areas like construction and manufacturing did not. UALR economist and state economic forecaster Michael Pakko says the new numbers do not reflect “unambiguously positive news.”
“While we saw the number of unemployed decline again last month by over 2600, we’re not seeing a commensurate number of people reporting that they’re finding jobs. Instead we’re seeing that the labor force is contracting. So what’s happening is that people are leaving the labor force and the unemployment rate is being calculated from a smaller base,” he says.
Pakko identifies this trend as a “troubling undercurrent” of the overall improving Arkansas economy:
“Ordinarily when you’ve gone through a period where the job market has been performing fairly well as it has been since last August, you would actually expect people to come into the labor force, thinking that things are improving, they start looking for work. But we’re seeing exactly the opposite: that it’s more what you’d expect to see in a weakening labor market where discouraged workers are just giving up on finding a job,” he says.
Nevertheless, Pakko says he expects to continue to see steady but slow declines in the unemployment rate in future months.
You can read the full report from the Arkansas Department of Workforce Services here.