MOORE: We start our show with our regular Friday contributor, albeit with a different inquisitor today. Joining me over the phone from his office in Fort Smith is Michael Tilley with Talk Business & Politics. Michael, good to catch up with you again today. There's your $3 word of the week for you, inquisitor.
TILLEY: Well, as long as you're not a Spanish inquisitor, then I'll be just fine.
MOORE: Exactly.
TILLEY: Because nobody expects the Spanish Inquisition.
MOORE: Exactly.We'll start our conversation today on a bit of a down note. Average weekly wages during the first quarter of 2025 in Crawford and Sebastian counties have declined compared to the same quarter in 2024. Is this a surprise for you when you look at this data?
TILLEY: Well, it was a big surprise because Benton County had the largest average weekly gain of all the nation's 372 largest counties. It had an increase of almost 15 percent. The Arkansas average was up 5.6 percent. When I drilled down further, I checked my numbers several times thinking that maybe I'd transposed or done something. But the Sebastian County average weekly wage in the first quarter was $1,083. That was down 1.9 percent. The Crawford County average was $932, down 2.5 percent.
The Bureau of Labor Statistics does not provide any explanation for what drives increases or gains in that number. That was a surprise, not a good surprise for the metro. Some of the other counties in the area—Franklin County’s average was $939, up almost 9 percent. Logan County was $830, up 3.7 percent. LeFlore County over in Oklahoma was up almost 5 percent. Sequoyah County, also nearby in Oklahoma, was up almost 6 percent. Unfortunately, the two largest counties in terms of the number of jobs and businesses were down for the quarter. Hopefully that's some kind of blip. Maybe we'll have a revision later on. I'm certainly looking forward to seeing how those numbers change in the second quarter, because one quarter does not make a trend. You hope it's not a trend.
MOORE: We'll talk more about the Compass Report in a few minutes. But overall, the economy in the metro region grew in the first quarter, so it does seem like an anomaly that we saw such a significant drop.
TILLEY: Correct. And I hope it is an anomaly.
MOORE: OVG, the company that manages the Fort Smith Convention Center for the city, will not be able to cater off-site events. What is the impact of a decision like this for the city and for the convention center?
TILLEY: It's one of those “damned if you do, damned if you don’t” stories. The board has told OVG, which manages the convention center, to generate more revenue because whatever they don't generate, the city picks up in subsidy. The city has been subsidizing it between $700,000 and $900,000 a year. The board asked OVG to get that subsidy rate down.
One of the things OVG said was, “Let us cater to off-site venues. We have a full kitchen now, which the city helped OVG pay for.” We’ll go into that a little. The convention center now has a big, full kitchen. They asked to cater to some of these off-site venues because they've been asked to do so.
Some local folks have pushed back saying, “No, you shouldn't be able to compete against local businesses, especially if your kitchen and facilities have been subsidized in part by the city of Fort Smith.” The board essentially didn't even take up the motion. It died on Tuesday.
Shannon Davis, the general manager with OVG at the convention center, tried to explain to the board that we're not asking to cater to small groups. Once you get over 300 people for an event, there aren't many businesses—just two or three—that can handle it. She said the issue is if they can't handle it, they'll bring in caterers, and according to her, they already do bring in caterers from Little Rock or Northwest Arkansas. That money is already leaving.
Her argument is, if you want us to raise more revenue, let us cater off-site. There's some notion they'll come back and put a cap on it, a number the board thinks protects local folks but also gives OVG a chance to go after large catering business. I don't think this issue is dead. City staff recommended giving OVG this off-site catering ability because it would raise more revenue, which reduces the city’s subsidy. Bottom line: I don't think the issue is dead, but it was surprising it didn't even get a motion. There was no board discussion. It just died on the vine.
MOORE: As you point out in your reporting, OVG is not based in Arkansas. They're a Denver-based company, but the people who work for OVG and the convention center are local people in the Fort Smith area.
TILLEY: Right. That was part of Shannon's point: you're essentially sending this business to outside companies. There's frustration all around. The board's pressured by local folks to support local businesses, but they're also pressured to spend less subsidizing the convention center. OVG comes to the board and says, “We can help you with that.” The board says no. It's a complicated subject, and I don’t think we've seen the last of it.
MOORE: The index shows that freight in the Arkansas River Valley is at a low, perhaps one of the lowest we've seen in quite some time.
TILLEY: Yes. Overall Arkansas River tonnage through the first eight months of 2025 is 6.5 million, almost 6.6 million tons. That's down almost 19 percent compared to the same period last year. August tonnage was down almost 18 percent. These are numbers, Matthew, that I haven't seen since the historic flood in 2019.
We're seeing it broadly among categories. Sand, gravel, and rock shipments—the largest of all shipments on the river, a little over 2 million tons—are down 30 percent through August. Chemical fertilizer, 1.3 million tons, is down 23 percent. Iron and steel, surprisingly, was up 10 percent. Wheat tonnage is down 16 percent, and minerals and building materials are down 20 percent.
River operators say there are definite economic pressures from President Trump's tariff policies. It just has everything kind of bottled up. People aren't shipping. They don't know when to ship. Whenever you get economic uncertainty, and a lot of the products shipped on the river are foundational to our economy, when you start seeing those get locked up and delayed, you should take note.
MOORE: And the sorts of things being shipped on the river—is there a logistical reason as to why they are shipped that way instead of over the road?
TILLEY: It's cheaper. Much cheaper. For example, a lot of sand, gravel, and rock come directly from the river. It’s tonnage. Tons of chemical fertilizer are offloaded at port, put on trucks, and sent around the country. For example, some products offloaded in Fort Smith end up on the West Coast by truck.
MOORE: Let's go out on a slightly higher note, perhaps as we said before, a moderate note. The new Compass Report has come out. It shows that Arkansas's economy is expanding but perhaps slowing in some regions, including the Fort Smith region.
TILLEY: Yes. We do the Compass Report quarterly. The University of Arkansas–Fort Smith, through their Economic and Workforce Development Center and Center for Economic Development, helps us compile the data and provide analysis.
In the second quarter, central Arkansas received a B-minus grade. Fort Smith metro had a C grade. Jonesboro had a C-plus. Northwest Arkansas had a B-minus. To explain: if you have a C, it means you didn't improve but you didn't decline—you were flat compared to the same quarter in the previous year. You want a C-plus, B, or A.
In this report, both Fort Smith and Jonesboro slipped into the C category. Northwest and Central Arkansas are still doing well, just moderating a bit. Even in Northwest Arkansas, maybe a little moderation is a good thing.
According to the report, Fort Smith metro added about 1,700 jobs year over year, with increases in construction and hospitality. Manufacturing stayed the same, and you'd want manufacturing to grow because it's a good wage base.
Nationwide, we're seeing lower growth. Many economists predict moderation in GDP growth, so I'm not surprised. But like with wages, let's hope this is not a trend.
MOORE: We did just see the Fed make a slight decrease in interest rates this week. Perhaps that might help kick-start some of this as well.
TILLEY: Yes. The third-quarter report probably won't reflect interest rate changes, so maybe the fourth or first quarter of next year before we see that.
MOORE: Well, you don't have to wait until then to see Michael Tilley again here on Ozarks at Large. Michael, thank you, as always, for spending some time with us. I appreciate it.
TILLEY: You're welcome, sir.
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