Industries Impacted by the 2024 Labor Shortage in Arkansas

Solutions for industries affected by labor shortage in Arkansas, EB-3 Visa green card jobs, 2024 labor shortage solutions for Arkansas industries

Arkansas is grappling with a significant labor shortage that is impacting various sectors of its economy.

Arkansas currently has 44 available workers for every 100 open jobs.

With 84,000 job openings and 37,339 unemployed workers, the state’s labor force participation rate is 57.7%, while the unemployment rate is 2.7%. 

The state’s quit rate is 2.7%, and the hiring rate is 4.3%.

This labor shortage is a local concern and a more critical national trend, further exacerbated by the pandemic, demographic shifts, and evolving workforce expectations.

The pandemic has led to an unprecedented disruption in the labor market, causing many workers to reassess their career paths and work-life balance.

Demographic shifts, including an aging population and declining birth rates, have further strained the labor pool.

Many older workers are retiring or reducing their work hours, while the younger generation entering the workforce is smaller, creating a gap that is difficult to fill.

Evolving workforce expectations, such as the demand for remote work and greater job flexibility, have reshaped the employment landscape, making it more challenging for traditional sectors to attract and retain talent.

Workers are now seeking more than just a paycheck. They want jobs that offer a better work-life balance, career development opportunities, and a supportive work environment.

Retail businesses are feeling the pinch, with many stores operating with reduced hours due to staffing issues.

Industries Most Affected by Arkansas Labor Shortage

1. Agriculture

Arkansas’s agricultural sector is a cornerstone of its economy.

The net farm income in Arkansas for 2024 has dropped by $0.5 billion compared to the levels in 2023, as indicated by a report from the Rural & Farm Finance Policy Analysis Center.

The state produces rice, cotton, soybeans, and poultry.

The industry has been struggling with a dwindling workforce.

The seasonal nature of the work, combined with physically demanding tasks and relatively low wages, makes it challenging to attract and retain workers. 

2. Manufacturing

The manufacturing industry needs help finding skilled labor, affecting production schedules and the ability to meet market demands. 

At the beginning of 2024, Arkansas’ manufacturing sector had approximately 163,000 available jobs.

In June 2024, job openings had risen to 165,300, marking the highest count since April 2009, at 166,100.

The state hosts numerous factories that produce everything from automotive parts to food products.

The labor shortage here is driven by an aging workforce, a skills gap, and the reluctance of younger generations to pursue manufacturing careers.

The lack of workers has resulted in delays in production and higher expenses.

3. Healthcare

The healthcare sector in Arkansas needs more professionals, including doctors, nurses, and support staff, leading to longer times and reduced access to care.

The Arkansas Center for Health Improvement (ACHI) published an article in Health Affairs stating that before the pandemic in February 2020, approximately 923,148 Arkansans, nearly one-third of the state’s population, were enrolled in Medicaid.

Following the end of the unwinding period on Oct. 1, 2023, the enrollment decreased to 868,059, a 5% decrease compared to the average enrollment in 2019.

The COVID-19 pandemic intensified this issue, with burnout and early retirements exacerbating the problem.

Rural areas, in particular, are experiencing severe shortages, impacting the quality and accessibility of healthcare services. So

Solutions to the Labor Shortage

1. Enhanced Training and Education Programs

Investing in workforce development programs to train and upskill workers, promoting the state as an attractive place to live and work, and adopting flexible work policies to meet the expectations of the modern workforce.

As of May 2024, are 9,309 apprentices actively enrolled in Arkansas, with only 379 having finished their programs.

Collaboration between government, businesses, and educational institutions will be essential to create a sustainable and resilient labor market.

Vocational training and education programs can help bridge the skills gap.

Arkansas can collaborate with community colleges and technical schools to offer programs tailored to the needs of the affected industries.

Apprenticeships and on-the-job training provide practical experience and attract new talent.

2. Hiring Workers from Abroad

The EB-3 visa category provides a practical solution to Arkansas’s shortage of unskilled workers.

This employment-based option is intended for individuals who can fulfill roles requiring less than two years of training or experience.

Arkansas can access a global labor pool to meet its increasing need for unskilled workers in various sectors, such as agriculture, manufacturing, healthcare, and hospitality.

Arkansas employers can recruit workers worldwide, ensuring that even the most labor-intensive and entry-level positions are filled, which is particularly vital for industries facing persistent labor shortages.

Encouraging immigration and promoting a diverse workforce can help alleviate labor shortages by introducing new skills and perspectives.

Building a supportive environment for immigrants through community programs, language training, and cultural integration initiatives can aid newcomers in settling and thriving in their new communities.

Highlighting the advantages of a diverse workforce, like increased creativity and problem-solving abilities, can motivate businesses to embrace diversity and inclusion.

This stability is particularly beneficial for employers who invest in training their workforce.

Many industries in Arkansas experience fluctuating labor demands due to seasonal variations.

The EB-3 visa program can provide a steady supply of workers to meet these cyclical needs, ensuring businesses can maintain smooth operations.

3. Offering Incentives for Workers

Offering financial incentives such as sign-on bonuses, higher wages, and benefits can make jobs in these sectors more attractive.

In May 2024, Arkansas had 13,889 homes available for purchase, marking an 18.8% increase compared to the previous year.

The number of newly listed homes rose by 3.4% year over year, with 4,408 new listings.

The average months of supply stands at three months, showing no change from the previous year.

Providing housing assistance or relocation packages can help draw workers from other regions.

In agriculture, for example, seasonal workers could be offered bonuses for completing the harvest season or provided with subsidized housing to reduce living expenses.

In healthcare, loan forgiveness programs for nurses and doctors who commit to working in rural areas can help alleviate the shortage in underserved regions.

Offering competitive wages and benefits, such as health insurance and retirement plans, can help retain employees and attract new talent in the hospitality industry.

4. Flexible Work Arrangements

Implementing flexible work schedules and remote work options can attract more employees.

Flexibility is particularly appealing to younger workers and those with family responsibilities.

According to a report by TechSmith Corp., Global Workplace Analytics, and Caryatid Workplace Consultancy, most employers still need to adjust their policies to accommodate the move to flexible work and 75% of workers report that their employer still needs to offer training to manage this shift.

In healthcare, for instance, flexible scheduling can help manage burnout by allowing healthcare professionals to better balance work and personal life.

Shift flexibility and part-time options in manufacturing can attract semi-retired individuals or parents seeking work-life balance.

In the hospitality industry, flexible scheduling can help accommodate employees with other commitments or prefer non-traditional work hours.

Seasonal work arrangements can also attract students or individuals seeking temporary employment opportunities.

5. Engagement and Support

Engaging local communities through job fairs, career counseling, and partnerships with local organizations can help connect employers with potential workers.

Support services such as childcare and transportation can also remove barriers that prevent people from entering the workforce.

Enhancing workplace conditions, including safety measures, job security, and a positive work culture, can make jobs more appealing.

Addressing issues like long hours, high stress, and poor working conditions, especially in healthcare and hospitality, can reduce turnover and attract new employees.

Thirty-two and 6 percent (32.6%) of adults in Arkansas reported symptoms of anxiety and depressive disorder, compared to 32.3% of adults in the U.S.

In agriculture, ensuring safe and humane working conditions, providing adequate rest breaks, and improving access to amenities can make the sector more attractive to workers.

In manufacturing, fostering a safety culture and continuous improvement can help retain employees and attract new talent.

Solutions for industries affected by labor shortage in Arkansas, EB-3 Visa green card jobs, 2024 labor shortage solutions for Arkansas industries
The Bottom Line

The labor shortage in Arkansas is a complex issue with far-reaching implications for the state’s economy and residents.

The convergence of factors such as the pandemic, demographic shifts, and changing workforce expectations has created a critical and multifaceted challenge.

The impact of the labor shortage is evident across vital sectors like agriculture, manufacturing, and healthcare, affecting production, access to care, and overall economic performance.

Enhanced training and education programs aimed at upskilling and reskilling the workforce, promoting the state as an attractive place to live and work, and the adoption of flexible work policies to align with the modern workforce’s expectations are crucial steps.

Collaboration between government, businesses, and educational institutions will create a sustainable and resilient labor market.

Hiring workers from abroad, such as through the EB-3 visa category, could provide a practical solution to augment the existing workforce, particularly in sectors experiencing acute shortages of skilled workers.

Investment in workforce development and a concerted effort to align the state’s labor market with the evolving needs and expectations of the workforce.

If the above-mentioned strategies are implemented, Arkansas can work towards building a sustainable and resilient labor market for the future, ensuring economic stability and prosperity for the state and its residents. Solutions for industries affected by labor shortage in Arkansas, EB-3 Visa green card jobs, 2024 labor shortage solutions for Arkansas industries

References:

Lindsay Cates and Stephanie Ferguson. “Understanding America’s Labor Shortage: The Most Impacted States”. https://www.uschamber.com/workforce/the-states-suffering-most-from-the-labor-shortage?state=ar

2 Rural & Farm Finance  Policy Analysis Center. “Spring 2024 Arkansas

Farm Income Outlook”. https://ruralandfarmfinance.com/wp-content/uploads/2024/04/Spring_2024_-AR-farm-income-outlook_final.pdf

3 Michael Tilley. “State of the State 2024: Manufacturing sector faces uncertainty, continued labor challenges in 2024”. https://talkbusiness.net/2024/02/state-of-the-state-2024-manufacturing-sector-faces-uncertainty-continued-labor-challenges-in-2024/

4 Steve Brawner. “State of the State 2024: Arkansas health care faces challenges”. https://talkbusiness.net/2024/01/state-of-the-state-2024-arkansas-health-care-faces-challenges/

5 Arkansas Statewide: Apprenticeship Summit. https://dws.arkansas.gov/wp-content/uploads/Combined-Presentation-AR-Apprenticeship-Summit-2024.pdf

6 EB-3 Work. https://eb3.work/

7 USCIS. “Employment-Based Immigration: Third Preference EB-3”. https://www.uscis.gov/working-in-the-united-states/permanent-workers/employment-based-immigration-third-preference-eb-3

8 Arkansas Housing Market. https://www.redfin.com/state/Arkansas/housing-market

9 Carolyn Crist. “3 in 4 workers say they haven’t been trained for flexible work arrangements”. https://www.manufacturingdive.com/news/workers-not-trained-for-flexible-hybrid-work-management-hr-pandemic/710861/

10 KFF. “Mental Health in Arkansas”. https://www.kff.org/statedata/mental-health-and-substance-use-state-fact-sheets/arkansas/