The economic burden of housing and child care in NWA
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Northwest Arkansas needs to build 15 housing units a day to keep up with growth — and it's not doing that.
Why it matters: While NWA is building a lot of apartments, it's not enough for the approximately 20 people moving to Benton County daily and 10 people to Washington County every day, Mervin Jebaraj, director at the University of Arkansas' Center for Business and Economic Research said during an event Thursday.
- Housing in NWA has a vacancy rate of about 3.3%, Jebaraj said.
Driving the news: The Northwest Arkansas Council and the University of Arkansas Walton College of Business released their annual State of the Region report last week.
- The findings look at changes in economic factors like wages and poverty rates and compare NWA to six other "peer regions" — Austin, Texas; Des Moines, Iowa; Madison, Wisconsin; Durham, North Carolina; Raleigh, North Carolina; and Provo, Utah.
How it works: The data takes into account Benton, Washington and Madison counties.
- Madison County had an estimated 17,775 people in 2023, according to the census, making it about 3% of the region's population.
State of play: Wages have increased fast in NWA and aren't the reason for the region's affordability problem — it's that the cost of housing is outpacing them, Jebaraj said.
- The median household income in 2023 was $77,695, up about 34% from $57,911 five years earlier, according to an earlier report.
- But the median sale price of single-family homes increased by about 71% from 2019 to 2023, according to census data Jebaraj shared.
- And rents have increased by roughly 43% over five years, hitting a typical price of about $1,000 per unit in 2023 compared to about $700 in 2018. They've continued to inch up this year topping $1,000.
The intrigue: The cost of child care is one of the region's major challenges to improving the labor market, Jebaraj said.
- NWA has an unemployment rate of 2.4%, making it nearly tied with the lowest of its peer regions as Madison had a 2.3% rate.
- The overall labor force participation rate for people ages 25-64 in NWA is 81.5%, compared to the national rate of 79.9%. However, moms with children ages 6 and under have a labor force participation rate of 70.3%, lower than the national rate of 74.7%.
Zoom out: The poverty rate decreased from 10.9% to 10.4% from 2022 to 2023, and the share of adults with bachelor's degrees or higher degrees rose to 36.6% from 36.3%, according to the report.