The Top 10 Business Stories of 2008

by Arkansas Business Staff  on Monday, Dec. 22, 2008 12:00 am  

John Glasgow, CFO of CDI Contractors, disappeared on Jan. 28. Dillard's owned a half-interest in CDI and was embroiled in a bookkeeping dispute with CDI management when Glasgow, of Little Rock, vanished.

1.) State Economy Holds Breath
A Gallup poll in mid-December showed that the economy is the No. 1 issue, with 55 percent of Americans believing it is the top problem facing the United States.

The country has been in a recession since December 2007, but the economy, which had been sputtering along most of the year, almost ground to a complete halt in the last quarter as job losses mounted and Americans cut back on nonessential spending.

The economic woes mushroomed as hundreds of billions of dollars in home loans – and the investments they secured – soured. The resulting credit crisis caused the collapse of several large financial institutions, affecting all sectors of the economy. The federal government jumped in to bail out some. Despite the action, the latest government data forecast a serious recession.

Indebted America's wakeup call has had less of an impact on Arkansas, which rarely feels the full brunt of any downturn, just as it rarely feels the euphoria of a boom. The state government is now a rarity in the U.S.: It has a budget surplus while most states are in debt and some are asking Congress for help.

Through November, five months into the state's fiscal year, the Arkansas Department of Finance & Administration said net available general revenue was 5.1 percent above last year and 0.6 percent above its revised general revenue forecast.

The only potential problem with the latest report was the decline in gross receipts, which include the sales and use tax. That indicates that Arkansans, as are other Americans, are spending less, a development that the General Assembly will need to consider as it begins to make spending plans.

That's not to suggest that all the state's economic news was good. Layoffs erased many of the jobs created in 2008. The Arkansas Economic Development Commission, which doesn't track all job creation, says at least 9,588 jobs will be created by new projects or expansions announced since Jan. 1. The Governor's Dislocated Worker Task Force, which tracks only those companies that seek its help, recorded layoffs of 8,950 workers at 114 companies since the first of the year. Both figures are through the middle of December.

The Arkansas Department of Work-force Services says the civilian labor force in October was 1,385,700 – an increase of 15,900 people over the labor force of 1,369,800 in October 2007.

Although the unemployment rate of 5.4 percent in the state has remained well below the national jobless rate of 6.7 percent, significant layoffs took place in every sector – telecommunications, manufacturing, forest products, agribusiness, retail, financial, health care and transportation.

The troubles for Pilgrim's Pride, the nation's biggest chicken producer, now in bankruptcy, led to the layoffs of more than 1,000 in the state in 2008. Baldor Electric Co. of Fort Smith plans to cut 900 jobs by June 2009, but didn't say how many would be in Arkansas.

Whirlpool has laid off 700 workers, and Riverside Furniture let 250 workers go at Fort Smith. Franklin Electric Co. at Siloam Springs shed 200 jobs. American Railcar Industries at Paragould could lay off some 600 workers. Looming on the horizon is the loss of 1,000 jobs or more at Alltel Corp. of Little Rock when the deal with Verizon Wireless is completed. AT&T and Bank of America have also announced huge layoffs, but there's been no word on how many Arkansans will be affected.

However, the state also made numerous big-time job announcements.

Among the larger ones:



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