Economy of Arkansas facts for kids
State quarter
|
|
| Statistics | |
|---|---|
| GDP | $176.24 billion |
|
GDP per capita
|
$54,347 |
|
Population below poverty line
|
19.1% |
| 0.4773 | |
|
Labor force
|
1,349,512 |
| Unemployment | 4.0% |
| Public finances | |
| Revenues | $4,604 million |
| Expenses | $4,604 million |
The economy of Arkansas is all about how people in the state make and spend money. In 2023, Arkansas produced $176.24 billion worth of goods and services. This is called its Gross Domestic Product (GDP).
Arkansas is home to six of the largest companies in the United States, listed in the Fortune 500. One of these is Walmart, which is the biggest company in the world by how much money it makes! In 2023, the average income for each person in Arkansas was $54,347. The typical household earned about $55,432.
CNBC says Arkansas is a good place for businesses. It ranks 35th among all U.S. states. It has low costs for doing business and for living. Arkansas has improved a lot in these rankings since 2011.
People in Arkansas are also very generous. In 2011, they gave a lot of their extra money to charity. This made Arkansas the seventh most generous state. The Pine Bluff metropolitan area was also ranked as one of the most charitable cities.
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What Arkansas Sells to Other Places
Arkansas sells many things to other states and countries. These sales are called exports. In 2011, Arkansas exported goods worth $5.6 billion.
Top Exports from Arkansas
One of the main things Arkansas exports is civilian aircraft. These are planes used for travel, not for the military. Other important exports include:
- Poultry (like chickens)
- Cotton
- Rice
- Graders (machines used in construction)
- Ammunition
- Special chemicals
- Steel
- Shock absorbers (parts for vehicles)
A big company called Dassault Falcon Jet Corporation in Little Rock is owned by a foreign company. It is one of the largest foreign-owned businesses in Arkansas.
Who Buys from Arkansas?
In 2011, Arkansas sold most of its exports to these countries:
- Canada (24.9%)
- Mexico (12.1%)
- China (7.4%)
- Japan (3.8%)
- South Korea (3.5%)
- France (3.0%)
- Singapore (3.0%)
Catfish Farming in Arkansas
Arkansas is a top state for raising channel catfish in farms. This is called aquaculture. In 2010, about 19,200 acres (77.7 km2) of land were used for catfish farming. The most catfish farming happened in 2002. Back then, 38,000 acres (150 km2) were used.
In 2007, catfish farmers in Arkansas made $71.5 million from their sales. This was 16% of all catfish sales in the U.S. Arkansas was the first state to start commercial catfish farms. This happened in the late 1950s. More farmers started raising catfish in the 1990s. It helped them earn extra money when prices for cotton and soybeans were low.
Arkansas's Biggest Companies
Arkansas has many large companies. Some are public, meaning their shares can be bought and sold by anyone. Others are private, owned by a smaller group of people.
Public Companies in Arkansas
Here are some of the largest public companies based in Arkansas. These companies are so big that they are listed in the Fortune 1000 list of top U.S. companies.
| State Rank by Revenue |
Company Name | National Rank |
Revenue ($billions) 2012 estimate |
Headquarters City | NAICS Sector |
|---|---|---|---|---|---|
| 1 | Walmart | 1 | 500.3 | Bentonville | Retail Trade/Warehouse Clubs and Supercenters |
| 2 | Tyson Foods | 80 | 38.3 | Springdale | All Other Miscellaneous Food Manufacturing |
| 3 | Murphy USA | 279 | 10.9 | El Dorado | Convenience Stores |
| 4 | J. B. Hunt | 395 | 7.2 | Lowell | Freight Transportation Arrangement |
| 5 | Dillard's | 439 | 6.4 | Little Rock | Department Stores |
| 6 | Windstream | 474 | 5.8 | Little Rock | Communication Services, not elsewhere classified |
| 7 | ArcBest Corporation | 763 | 2.8 | Fort Smith | General Freight Trucking |
| 8 | Murphy Oil | 902 | 2.2 | El Dorado | Crude Petroleum Extraction |
Private Companies in Arkansas
Only one privately owned company in Arkansas had revenues over $1 billion in 2011.
| State Rank by Revenue |
Company Name | National Rank |
Revenue ($billions) 2007 estimate |
Employees | Headquarters City | NAICS Sector |
|---|---|---|---|---|---|---|
| 1 | Golden Living | 154 | 2.73 | 42,000 | Fort Smith | Other Individual and Family Services |
Energy in Arkansas
Energy in Arkansas Energy is a big part of Arkansas's economy. It involves producing and using power for homes, businesses, and transportation.
How Arkansas Makes Energy
In 2007, Arkansas produced a lot of energy. Most of it came from natural gas, nuclear power, and renewable sources. A smaller amount came from coal and petroleum.
Arkansas uses petroleum for transportation, like cars and trucks. But it produces more electricity than it uses. So, it sells extra electricity to other states. Because Arkansas has many rural areas, people there often spend more on energy than the national average.
Oil and Gas Production
Oil production started in Arkansas in the early 1920s. This led to a big "oil boom" in southern Arkansas. Towns like El Dorado and Smackover grew quickly because of oil. Today, oil is a smaller part of the state's economy. However, the oil industry still provides many jobs in the region. You can learn about this history at the Arkansas Museum of Natural Resources.
Natural gas has also become important in north central Arkansas. A method called hydraulic fracturing (or "fracking") is used to get gas from the ground. This has affected the economy in several counties. Arkansas was the 12th largest producer of natural gas in 2007. However, concerns about the environment have slowed down new gas projects.
Coal and Renewable Energy
Arkansas also has some coal, mostly in the western part of the state. This coal has a low sulfur content, which is good for the environment.
Renewable energy is also important in Arkansas. These are energy sources that can be replaced naturally. In 2007, 10% of Arkansas's energy came from renewable sources. The biggest source of renewable energy is hydroelectric power. This comes from dams that use flowing water to make electricity. Dams like Beaver, Bull Shoals, and Greers Ferry all produce hydroelectric power.
Arkansas has potential for wind energy, but not many wind turbines are built yet. However, some large companies that make wind turbine parts have factories in the state.
Agriculture in Arkansas
Farming is a very important part of Arkansas's economy. Most of the farming in Arkansas is for raising livestock, like cattle and chickens. Growing rice is also a big deal. A lot of the farmland in Arkansas uses irrigation, which means water is supplied to the crops.
In 2023, agriculture was the largest industry in Arkansas based on the number of jobs it provided.
State Taxes in Arkansas
Arkansas collects taxes to pay for public services like schools and roads. There are different kinds of taxes.
Income Tax
Arkansas has a state income tax. This is a tax on the money people earn from their jobs. The tax rate changes depending on how much money someone makes. Military pay has some special rules. Also, people who live in Texarkana, Arkansas do not have to pay Arkansas income tax.
Sales Tax
Arkansas has a sales tax on most things you buy. The state's sales tax rate is currently 6%. Many services also have sales tax. This includes things like dry cleaning, pest control, and pet grooming.
Cities and counties in Arkansas can also add their own local sales taxes. These local taxes are collected by the state and then sent back to the cities and counties. People with very low incomes might not have to pay sales tax on their electricity bills.
Other Taxes
There are also special taxes on alcoholic drinks. For example, there's an extra tax on mixed drinks sold at restaurants.
Property Tax
Property taxes are collected on land and buildings. They are also collected on personal property, like cars. The tax is based on only 20% of the property's value.
