Shelnutt: Employment, Income to Improve in Arkansas in 2005

by Lance Turner  on Wednesday, May. 11, 2005 12:10 pm  

Employment and personal income will continue to improve in Arkansas in 2005, while the lack of a manufacturing rebound will hurt the state's rural areas, according to economist John Shelnutt.

Shelnutt, the University of Arkansas at Little Rock researcher who regularly surveys the state's economy, spoke Wednesday at the UALR Institute for Economic Advancement Economic Forecast Conference.

Shelnutt, who gave economic forecasts for the state and the nation, said that Arkansas employment has gained a "slight momentum" in 2005, falling in line with the national trend. Arkansas' unemployment rate dropped to 5.2 percent in March, equal to the national rate. The state's unemployment data for April will be released May 17.

But Shelnutt noted that the state's economic recovery since 2002's recession differs from its recovery from the recession in the early 1990s, when Arkansas outpaced the national recovery with growth in its food processing industry. Now, however, the state has no such growth industry. And employment in the state's food processing industry has been flat since about 1995, according to Shelnutt's report.

The result is that the state is only keeping in line with the nation's recovery, he said.

Also, Shelnutt said, the state's metropolitan areas, led by Fayetteville-Springdale-Rogers, are the places seeing growth in nonfarm employment. Rural areas of the state, where there is a dearth of manufacturing growth, are expected to see little employment growth over the next five years.

Winners for the next four years in Arkansas' economic climate include the travel and tourism industry, nonresidential construction, and aircraft production. Losers include low-income households hurt by high energy costs; housing starts, which are expected to decline; and the federal government.

 

 

Please read our comments policy before commenting.