Arkansas
UA economist provides positive outlook for Northwest Arkansas – Talk Business & Politics
A University of Arkansas economist painted a rosy picture of the Northwest Arkansas economy amid expectations of strong U.S. GDP growth, ranging between 3% and 4% in the third quarter. The Bureau of Economic Analysis will post third-quarter GDP data on Thursday (Oct. 26).
Economist Mervin Jebaraj presented the GDP projection and other economic data during a business analysis luncheon on Wednesday (Oct. 25) in Fayetteville.
Jebaraj said he expects about 4% growth but wouldn’t be shocked to see 5% growth in the third quarter. Before the COVID-19 pandemic, the long-term average GDP growth rate was about 2.1%. The second-quarter GDP growth rate was 2.1%.
“We’re not in a recession because…consumers are going out and spending money (and) the unemployment rates are low across the board,” he said. “You ask, ‘How low is it?’ Well, to be fair, I think even the unemployment benefits office has a help wanted sign on it today.”
The Center for Business and Economic Research (CBER) in the Sam M. Walton College of Business at the UA, in collaboration with the Northwest Arkansas Council, released the annual State of the Northwest Arkansas Region Report on Wednesday at the Fayetteville Town Center. Jebaraj, who’s director of the Center for Business and Economic Research, also provided economic data from CBER’s Quarterly Business Analysis.
Asked what letter grade he’d give the Northwest Arkansas economy, Jebaraj said “solid B+” when compared to peer regions. Asked when the next recession might be, Jebaraj said if he were to guess, the soonest one could happen would be in the second half of 2024. “We don’t have to have a recession,” he added.
Donna Morris, executive vice president and chief people officer for Walmart Inc., was guest speaker at the luncheon. She responded to questions from Nelson Peacock, president and CEO of the Northwest Arkansas Council.
Morris, who is on the council’s executive committee, said the region’s “amazing growth” in jobs stood out to her in the State of the Northwest Arkansas Region Report. The annual report compares Northwest Arkansas to six peer regions or regions that are typically much larger than Northwest Arkansas and some of the fastest growing in the United States.
Northwest Arkansas ranked second with 11.2% in nonfarm employment growth from 2020 and 2022, the report shows. Only the Austin, Texas, metro had higher growth at 16.7% over the period.
Jebaraj said almost everyone who can work is working in Northwest Arkansas, and employers are still struggling to hire. But he noted this has eased some from 2022. Since the start of the pandemic, Northwest Arkansas has added 35,000 jobs. Over the same period, Arkansas added about 70,000.
More than 575,000 people live in Northwest Arkansas, he said. The region is adding about 13,000 people annually. According to the report, Northwest Arkansas’ 4.9% population growth from 2020 to 2022 ranks third compared to the peer regions, behind the Austin metro (5.3%) and Provo-Orem, Utah, metro (5.9%).
However, Morris was concerned about the rising airfares noted in the report and encouraged airport officials in the room to attract more affordable airlines. The report compares economic data in 2022 to previous years. According to the report, airfares have risen by 33.5% to $499 in 2022 from $374 in 2020.
Asked why airfares rose, Aaron Burkes, CEO of Northwest Arkansas National Airport (XNA), said airfares have declined over the past year. He added that the airfares will be higher when compared to other airports because a large percentage of XNA’s passengers are business travelers. Business travelers often book flights shortly before departure when airfares are higher, driving up the average price.
Burkes said XNA officials meet regularly with low-cost carriers asking them to either start service here or expand flights to new destinations. He noted most low-cost carriers are focused on leisure, not business destinations. As a result, carriers offering business destination routes likely won’t face new competition, which could drive down airfares.
Morris also discussed the importance of home affordability, public transportation and Walmart’s new Home Office that’s under construction.
“It will start next year opening with the Walton Whole Health Fitness Center,” she said. “This is something like you’ve never seen before, and it will be available to our associates and their family members.”
She also said “downtown section” of the new Home Office will be open to the public, comprising food, activities and stores. There will also be a Walmart Welcome Center and a daycare, opening in mid-2024.
Another topic that both Peacock and Jebaraj noted in their presentations was commute time. Peacock said it’s a metric he’s interested in tracking as the region grows and wants to see how this affects the region’s quality of life.
Jebaraj said the metric coordinates with a region’s office vacancy rate. Higher commute times correlate with higher office vacancy rates.
Arkansas
Knowing the Florida Gators Opponent: Arkansas Razorbacks
Gainesville, Fla. – The Florida Gators men’s basketball team’s next destination is Fayetteville, Ark., as they’ll take on the Arkansas Razorbacks (11-4, 0-2) on Saturday for their third SEC matchup of the season.
Florida is currently sitting at 14-1 on the season and 1-1 in conference play. They opened their SEC slate with a nail-biting loss to the Kentucky Wildcats, losing 106-100 in Lexington.
However, the Gators were able to avenge this loss with one of the most dominant wins in men’s basketball history on Tuesday over No. 1 Tennessee. They trounced the Volunteers 73-43 in the O’Dome, marking the Gators’ first regular-season win over an AP No. 1-ranked team in program history and the biggest win over a No. 1-ranked team in the NCAA since 1968.
But enough about what Florida has done this season, let’s shift the focus to their opponents, the Razorbacks, and see who they are.
Arkansas’ season started out nice with a win over Lipscomb. However, it wouldn’t be the same for them in their second game of the season against then-ranked No. 8 Baylor, as they found themselves on the losing end of a tightly contested battle.
Then, following a good stretch for the team in red, they were tasked with the current No. 13 in the AP Poll, Illinois, and things wouldn’t go so well for new Razorbacks head coach John Calipari. His team was outclassed in this game 90-77, which ended their winning streak at four.
Arkansas did make amends with their fans a few games later, though. While participating in the Jimmy V Classic, they matched up with then-ranked No. 14 Michigan, who they narrowed past 89-87.
This win over the Wolverines helped maintain a three-game win streak that would eventually turn into a six-game streak. However, since SEC play started for the Razorbacks, they are 0-2 with losses to Tennessee and Ole Miss, who are currently ranked in the Top 25 AP Poll.
These pair of losses put Arkansas at just a 1-4 record against teams on their schedule to have been ranked or that are currently ranked.
While it was a complete roster overhaul for Calipari and the Razorbacks this offseason that was fueled by the transfer portal, their biggest grab has been from the high school ranks.
They added highly ranked players like Johnell Davis, Adou Thiero and Jonas Aidoo all from the portal, but it’s former five-star guard Boogie Fland who’s been arguably the best player for the Razorbacks this season.
Fland is averaging 15.5 points, 5.9 assists and 3.6 rebounds per game through 15 games this season. He is also connecting on 35.7 percent of his threes, which shows he’s more than just an inside scorer. Additionally, his 5.9 assists rank 24th among his competitors.
But in these first two SEC games, Fland is just 10-for-35 from the field and 3-for-17 from deep.
If the Gators can’t keep him in check like he’s been over these last two, then it might be a long afternoon for the visitors on Saturday.
Despite bringing in tons of talent that should’ve resulted in a great offense, Arkansas has been anything but that.
They currently rank inside the bottom five teams in the SEC in scoring offense, averaging 79.4 points per game. They do have two players scoring at least 15.0 points per game, but that’s pretty much it. Outside of Thiero (16.9) and Fland, they only have one other player in double figures (DJ Wagner, 10.5).
Moreover, if this becomes a free-throw-dominated affair, the Gators shouldn’t be too worried about the Razorbacks’ performance at the line. They are shooting 71.1 percent from the charity stripe, which is good for 12th in the league.
And, lastly, they have little to no presence on the glass. They are the worst team in the SEC in offensive rebounding, and they are 13th out of 16 teams in overall rebounding. These are two areas where the Gators dominate, and if things play out like they have been this season, then the visitors should outmuscle their counterparts.
This game will be televised on Saturday at 4 pm on ESPN.
Arkansas
Viewer pictures: The Natural State transforms into a winter wonderland
LITTLE ROCK, Ark. – A winter storm rolled into Arkansas Thursday and brought with it snow to the majority of western and central Arkansas.
Many from around the Natural State sent in pictures of their area covered in snow.
Though Arkansas is already full of natural beauty, there’s something about the state covered in snow that makes it even more of a winter wonderland.
Several kids from around the state got out and took advantage of the day off of school by throwing snowballs, digging up the snow, sledding and of course making snow angels.
Many who got out in the snow had enough accumulated to make snow men.
Share your snow day pictures at KARK.com/winter-pics.
Arkansas
Arkansas Blue Cross & Blue Shield Lays Off About 75 Workers, Reports $100M Loss
The Arkansas Blue Cross & Blue Shield building in Little Rock (Michael Pirnique)
Arkansas Blue Cross & Blue Shield sent layoff notices to 2% of its workforce — about 75 employees — on Thursday after reporting a loss of more than $100 million in the first three quarters of 2024, the state’s dominant health insurance carrier confirmed.
The Little Rock nonprofit had 3,375 employees as of April 2024, and its $3.14 billion in 2023 revenue put it at the top of Arkansas Business‘ most recent list of the state’s largest private companies.
But revenue in the first three quarters of 2024 was down by almost 7%, and the company (officially USAble Mutual) reported to the Arkansas Insurance Department a net loss of $100.5 million for those nine months. That compares with net income of $94.7 million for the same period in 2023, although the year finished with net income of just $13.2 million.
“The reduction in workforce was due to changing conditions in the market and increasing financial pressures primarily due to health care costs jumping to the highest levels in more than a decade,” Max Greenwood, an ABCBS spokeswoman, said in response to email questions Thursday afternoon.
ABCBS also has seen “large increases” in the use of all medical services, especially prescription drugs.
“These situations have caused necessary shifts in business strategy across the health care and health care insurance industries,” she said.
In addition, the insurance company lost tens of thousands of members as result of the state’s disenrollment of tens people on Medicaid in 2023.
As part of the Obama-era Medicaid expansion, the state pays private insurers to provide health insurance policies to qualifying Arkansans under the Arkansas Health & Opportunity for Me program, or ARHOME. This program had been known as the “private option” and Arkansas Works.
In January 2023, ABCBS had about 207,000 ARHome members. By December 2024, it was down to 108,729, Greenwood said.
“We’ve also seen a drastic increase in the claims amounts among our ARHome population,” she said. “Remember, since we were the first company who offered ARHome policies statewide when the program began, our block of members in that program is older and most likely unhealthier than what other carriers may be experiencing.”
ABCBS’ premium revenue fell during the first three quarters of 2024. It reported $2.2 billion premiums collected net of reinsurance through Sept. 30, a 4.8% drop from the same period in 2023.
The insurance company’s total members also fell from 630,444 on Dec. 31, 2023, to 598,492 on Sept. 30. The biggest drop came from its comprehensive individual plan. In that group, the total members fell nearly 17% to 132,596 members.
ABCBS also laid off 85 employees in January 2024. Those positions have not been refilled, Greenwood said.
She said it was too early to tell what the financial numbers will look like for the fourth quarter, which ended Dec. 31. No additional layoffs are planned at this time.
“Every executive vice president was asked to make reductions in their areas,” she said.
Greenwood said the insurance company has made several other budget-tightening moves for 2025. “We’ve reduced our budget by more than 7% including cuts to consulting and outside vendor costs, contract labor, software and equipment and facility costs,” she said. “We’ve also had to implement substantial premium increases on our small and large groups.”
Greenwood said the company has a strong balance sheet and has no concerns about its liquidity.
Founded in 1948, Arkansas Blue Cross & Blue Shield offers health and dental insurance policies for individuals and families.
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