Little Rock, Arkansas – Arkansas’ labor market shows a curious mix of growth and rising unemployment, according to the latest report from the Arkansas Department of Commerce. The state’s unemployment rate ticked up slightly, from 3.8 percent in August to 3.9 percent in September, following a similar trend nationally, where the unemployment rate now stands at 4.4 percent.
Although the increase is modest, it marks a continuation of the slow upward trend since Arkansas hit a record low of 2.9 percent in the summer of 2023. Despite the gradual rise, the state has avoided the large fluctuations seen in the national employment picture, maintaining a relatively stable labor market overall.
The report indicates that the civilian labor force in Arkansas expanded by 3,437 in September. Of that number, 1,891 were unemployed individuals actively seeking work, while 1,546 were newly employed. Nonfarm payroll jobs also reached a new high, rising by 16,000 in September to bring the total to 1,393,300 jobs statewide. Compared to September 2024, Arkansas now has 22,700 more jobs, demonstrating continued growth across multiple sectors.
Private Education and Health Services posted the most notable gains, adding 8,800 jobs. Other sectors showing strong growth include Trade-Transportation-Utilities, which rose by 4,900 jobs; Leisure and Hospitality, up 4,700; Professional and Business Services, up 3,500; and Manufacturing, which added 2,200 jobs. These figures highlight a broad-based recovery that is supporting the state’s economy while still leaving room for improvement in workforce participation.
However, unemployment is not evenly distributed across Arkansas. Desha County reported the highest rate at 7.2 percent, followed closely by Phillips County at 7 percent. Izard County in the north also showed a relatively high rate of 6.9 percent. These areas continue to face economic challenges despite the statewide job gains.
In contrast, northwest Arkansas maintains some of the state’s lowest unemployment figures. Benton County reported a 3.1 percent rate, while Washington and Madison counties each posted 3.3 percent. Central Arkansas counties also varied widely, with Pulaski County at 4.3 percent and neighboring Faulkner at 3.7 percent. Saline County had 3.4 percent, Lonoke 3.6 percent, and Jefferson County 6.3 percent.
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Economists note that the rise in unemployment alongside record job growth is partly due to more people entering the labor force, which can temporarily push the unemployment rate higher even as the number of jobs expands. In September, more residents actively sought work, contributing to the uptick in the unemployment figure.
Despite these nuances, Arkansas continues to demonstrate resilience in the labor market. The state’s growing job base, combined with relatively stable unemployment, suggests that economic expansion is ongoing, particularly in healthcare, education, and professional services. Policymakers and business leaders will continue monitoring these trends to ensure that economic growth translates into broad-based employment opportunities across the state.
With the labor force expanding and new job records being set, Arkansas faces both opportunities and challenges. The balance between increasing workforce participation and maintaining low unemployment will be a key focus for the coming months, as the state works to strengthen its economic foundation while addressing areas with higher unemployment.
