Arkansans and Americans in general seem to be feeling blue these days. Maybe a deluge of negative political advertising bludgeoned us into sadness. Perhaps I’m a “glass half-full” guy because I keep noticing that, nationally and within Arkansas, there are positive economic indicators.
Unemployment and inflation are in check. Manufacturers are expanding at the fastest pace in three years, according to a survey by the Institute for Supply Management. New orders indicate factory output will likely continue to grow.
This is an Opinion
Nationally and within the state, unemployment continues to improve. Yes, we have a collection of people who have left or delayed entry into the workforce. We also have people who are underemployed. However, as the jobless rate continues to drop, we are seeing the impact of a couple of key factors:
- Companies are hiring again. Our company has been expanding for the past couple of years, and other businesses are ramping up to take advantage of market opportunities.
- Downturns lead to more efficient business operations. I suspect anyone in business during the past five to seven years has figured out how to do more with less staff. Through deploying new technology or using plain old creativity, many businesses have discovered ways to hold on or even grow profit while minimizing the growth in overhead. As the economy improves, many businesses are positioned to perform well.
Unemployment rates in northwest Arkansas, Jonesboro and central Arkansas are better than the national average. Although there seems to be a flow of good economic news from those three areas, progress also can be seen in other regions.
In Clark County in southwest Arkansas, we’ve seen a spate of big economic development announcements. For example, Georgia-Pacific recently announced a $37 million expansion at its plant in Gurdon.
“I understand this expansion was approved by Charles Koch himself, so he has enough confidence in what’s happening in Clark County that he’s going to invest his money here,” said Stephen Bell, CEO of the Arkadelphia Regional Economic Development Alliance. “The county has been supportive with infrastructure upgrades. It’s the perfect example of a public-private partnership that brings about economic development.”
Also in Clark County, Antoine Hardwoods is adding 10 jobs, thanks to a grant from the Economic Development Corp. of Clark County. And Danfoss is planning to add 16 jobs to its operation. The new jobs are reported to pay approximately $16 an hour and will yield an annual payroll of $665,640.
Growth and optimism in the timber and the HVAC sectors are indicators of confidence in the future housing market.
If that wasn’t enough for Clark County, chicken processor Hillstern Farms opened its doors with grand fanfare a few weeks ago and started with approximately 40 employees.
Nearby Garland County is also seeing positive developments. For example, Oaklawn recently completed the first phase of a $20 million expansion that’s resulting in a new gaming area. Oaklawn will soon begin reconstruction and modification of part of the existing gaming area. This latest expansion is the second major project that Oaklawn has undertaken in the last six years. The total investment of $60 million is reportedly the largest private investment in Hot Springs history.
The good news isn’t limited to the southwest. The biggest project in the state is Big River Steel at Osceola. It continues to move forward with its $1.3 billion steel mill. The mill is to employ 525 people earning average yearly compensation of $75,000, and that after the workers hired to build the massive project.
Positive residual of that effort was the recent announcement that The Materials Works Ltd. of Red Bud, Illinois, revealed plans to build an advanced flat rolled toll processing center adjacent to the mill. The $20 million TMW plant will create 45 jobs.
Elsewhere in the state:
- Pinnacle North Corporate Aircraft Interiors of Little Rock plans to quadruple its space and hire an additional 25 employees by the end of 2015;
- Intimidator Inc. of Batesville will expand its plant and add employees to manufacture a new line of utility vehicles;
- Entergy Inc. broke ground on a 25,000-SF, $23 million transmission operations center in Little Rock;
- Robinson Center is undergoing a $68 million renovation that is just one element of millions of dollars of renovations and construction going on in downtown Little Rock; and
- Chaffee Crossing in Fort Smith continues to see significant investment and job growth.
And farmers are bound to be happy by indicators of a record yield for Arkansas corn, soybeans and cotton.
One negative note we hear from national media is that wages are stagnant. However, payroll giant ADP has noted that wages are moving upward.
In the third quarter, average hourly pay for workers earning less than $20,000 a year jumped 5.4 percent compared with the same period in 2013. Those earning $20,000 to $50,000 got increases of 4.9 percent. Mean-while, Americans making more than $50,000 a year received average raises of 4.3 percent.
The Bureau of Labor Statistics shows a similar trend. Workers at the 10th percentile of the pay ladder got average annual raises of 3 percent in the year ending Sept. 30.
Now, someone is bound to point out struggles in one part of the economy or another. Certain industries are more challenged than others, and there is no question the economy has room to improve.
However, there are plenty of signs that should give us confidence that that improvement may be around the corner. Now that the barrage of negative political ads is a distant memory, perhaps we can get our heads around a more optimistic view.
Mitch Bettis is president of Arkansas Business Publishing Group and publisher of Arkansas Business. Email him at MBettis@ABPG.com.