"We have heard from contacts in Arkansas that tourism has remained really strong even after their prices have increased. Businesses in the tourism sector - chiefly hotels - reported prices will rise a projected 5.2% this year, up substantially from 0.3% in 2022.Īrkansas tourism is particularly robust, according to Jefferson. That varies by industry, however, with about only 4% of retailers saying they felt comfortable increasing consumer prices, falling 14% from last year. About 63% of firms contacted by the Fed reported an ability to pass along price increases, down from 82% a year ago. Overall, companies in the region are projecting lower price increases in 2023. "Especially in Arkansas, the demand for entry-level homes has remained pretty solid," Jefferson said Wednesday. "It has been getting better but it remains an issue, particularly in Arkansas."Įntry-level homebuying is pushing up as demand drops for higher-priced housing, which is more sensitive to interest rates that have been rising since early 2022. "This is something we've heard from a lot of different contacts," Jefferson said.
"There's a lot of competition for workers and workers are moving to get wage gains," Jefferson said.Įmployers in the state are experiencing higher turnover rates and struggling to hire and retain workers over the past few months. It's still a favorable job market for workers. Workers are still seeing wage increases, but they have slowed over the past year.
"The exact amount that businesses are able to increase wages by and the amount they are able pass prices by has been curbed a little bit over the past few months." "Arkansas has seen stronger wage pressure than other parts of the district," Jefferson said. "As businesses feel pressure to get workers, they're experiencing wage pressure as well."Īt the same time, businesses are slowing wage increases as profit margins tighten. "This starts with strong consumer demand in Arkansas that's put more pressure on businesses to increase output and so businesses are looking for workers more in Arkansas than in other parts of the district," he added. Robust demand across the state is driving production for businesses while also increasing turnover as companies compete for workers, Nathan Jefferson, regional economist for the Fed, said Wednesday. Louis reported Wednesday in its latest Beige Book report of the regional economy. Economic conditions are holding steady in Arkansas though some sectors, most notably tourism and entry-level homebuying, are showing strong growth, the Federal Reserve Bank of St.
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