Market Update: We break down the business implications, market impact, and expert insights related to Market Update: Report: Fort Smith metro economy ‘stable,’ but lags peer economies – Full Analysis.
The Fort Smith metro economy is stable, with job growth seen in health care and tourism sectors, but relatively “weak” population growth restricts the size of the available regional workforce and has resulted in recent job growth being less than other Arkansas metro areas.
That was the assessment Kendall Ross, University of Arkansas at Fort Smith associate vice chancellor of Economic and Workforce Development, provided the Fort Smith Board of Directors on Tuesday (March 10) during a board study session.
Ross, who also compiles, manages and reviews data for The Compass Report on behalf of Talk Business & Politics, told the board that population growth in the region makes it difficult for employers to find enough workers and skilled-workers. He said the Fort Smith metro economy has “lagged our peers” partially as a result of the lower population growth.
Fort Smith, the third most populous city in Arkansas, gained population in 2024 after its population fell, based on 2023 estimates. The city’s population increased by 0.7% to 90,507 in 2024 from 89,859 in 2023. The population in Little Rock, the most populous city in Arkansas, rose by 0.3% to 204,774 in 2024 from 204,235 in 2023. The population of Fayetteville, the state’s second most populous city, rose by 1.6% to 103,134 from 101,511. Arkansas’ population grew 0.6% between 2023 and 2024.
Ross said it is good, however, that Fort Smith metro job growth is on “an upward slope,” with the manufacturing sector remaining an anchor for the regional economy, representing more than 17% of all metro jobs. The sector had an estimated 18,100 jobs in December, according to the U.S. Bureau of Labor Statistics, unchanged compared to December 2024. The number was up 14.5% compared with December 2020, but is 38% below peak manufacturing employment of 29,200 in June 1999.
The health care sector, according to Ross, has been a driver for regional job growth. The Education and Health Services sector had an estimated 17,800 jobs in December, up from 17,600 in December 2024, and up 7.9% compared with 16,500 in December 2019. The sector is up 17.1% compared with 15,200 in December 2015.
The region’s tourism sector has also seen job growth, and that is “a really good sign” for the metro economy, Ross said. The sector had 9,400 jobs in December, up from 8,900 in December 2024. The sector hit record employment of 9,800 jobs in June 2025.
Ross advised the board to monitor the construction sector because “when construction softens it can hint at a slower momentum for other parts of the economy.” The sector has been stable in recent years. Fort Smith metro construction jobs were an estimated 5,000 in December, down from 5,100 in December 2024. The average annual jobs in 2025 was 5,050, down from 5,100 in the pre-COVID year of 2019.
Ross also advised the board to be aware of the region’s housing affordability issue. He noted that average wages are up around 30% since COVID, which he said is a good gain, but metro home prices are up around 60% in the same period.
“This matters because (housing) affordability tightens the labor pool and puts pressure on households,” Ross said.
Coincidentally, the BLS on Tuesday reported average weekly wage data and other information for the third quarter of 2025. The report showed that average weekly wages in Sebastian County during the third quarter totaled $1,044, up 2.3% compared with the same period in 2024. Total quarterly wages paid in the county was $912.656 million, up 2.9% compared with the same period in 2024.