Arkansas is open for business, and business is good. That’s the assessment experts give the state’s current business climate, citing favorable financial elements and readily available resources directly targeting the health of companies of all sizes.
“Just say this: It’s an A- at worst; it could be a solid A but for a few headwinds around,” says Randy Zook, president and CEO of the Arkansas State Chamber of Commerce. “There are certainly pockets and places in the state that are not in high gear. But most of the state is experiencing very positive unemployment rates — people can find work if they are willing and able to go to work, and by that I mean, able to pass a drug test and have some reasonable skills.”
Zook says the recent federal tax overhaul has given business owners the money to invest in capital improvements and equipment upgrades sufficient to expand their market reach. That, combined with favorable interest rates, is pushing many of the state’s areas into overdrive.
“The biggest impacts are tax reform and a very strong economy on a global basis,” he says. “All the stars have lined up. Now, we could mess it up with this trade war if it gets out of hand, but the good news is they seem to be walking that back and it doesn’t seem to be as big a threat as perhaps it might have been a week or two ago. That’s very positive.”
In fact, conditions are so favorable for growth, it’s created its own set of issues in Arkansas, namely in the area of personnel. Zook says companies continue to struggle with a chronic shortage of skilled workers, which hamstrings many businesses’ plans for expansion.
“There are probably 25,000-plus high-wage, high-demand jobs that we simply can’t fill because we don’t have enough people with the right skills in the right places,” he says. “That’s everything from long-distance truck drivers to welders to CAD-CAM designers to CNC machine operators to people to work in poultry plants.”
Entrepreneurs are finding conditions especially favorable for a number of reasons. Joe Bell, professor of entrepreneurship at the University of Arkansas at Little Rock, says starting a business is suddenly en vogue from one end of the country to other and the Natural State is no exception.
“I think there’s a couple things taking place,” he says. “One, entrepreneurship is far more visible today than it was years ago. My parents said to me, ‘Go to college and then go get a good job.’ Nobody ever said, ‘Go work for yourself.’ Today, people look around and they see Facebook and Apple and so many other ventures that basically started in a garage with just a few people.
“The other contributor to this is technology. Technology makes it less expensive and just easier to enter the field of entrepreneurship,” he adds.
Add to this equation the state’s burgeoning number of resources for startups, including maker spaces such as the Arkansas Regional Innovation Hub in North Little Rock and business incubators like the Little Rock Technology Park and at University of Arkansas at Little Rock. These resources are designed to help new entrepreneurs get up and running and existing businesses overcome operational issues at little or no direct cost.
Kim Lane, chief operating officer of the Conductor, located on the University of Central Arkansas campus, says the value of such entities is to make connections between those with real-world business expertise and those who are trying to get an idea off the ground.
“What happens a lot to entrepreneurs is they kind of fall in love with their idea before they validate that it solves a problem and then they don’t make money,” she says.
“A huge component of what we do is free, one-on-one consulting. We meet with people from every single industry, all different backgrounds, all different ages. A lot of it is us taking them through entrepreneurial processes: Have you validated that this is a problem? Have you validated that people want a solution to this problem? Things like that.”
The Conductor has also developed a mentor network, composed of hand-picked individuals to lend expertise and input on every element of businesses operations at each stage of development.
“Mentorship is a huge component of successful entrepreneurs,” Lane says. “On a bi-monthly basis we have an invite-only mentor network meeting where we invite an entrepreneur who is facing a specific challenge or opportunity. They present to the network and say ‘Here is what I’m facing and here’s who I am. What advice do you have for me?’ Then we just have an open dialogue. By keeping it invite-only, we reduce barriers and let it be a safe space for them.”
The Arkansas Small Business and Technology Development Center (ASBTDC) operates in much the same manner, providing a wide range of consultative and advisory services to business owners. Based out of UA Little Rock, where it is an adjunct to the College of Business, ASBTDC subcontracts with six other campuses statewide. Funding is provided through a combination of federal grants and matching funds by sponsoring institutions.
Heather Robinette, consulting and market research manager, says the statewide network of centers provides an array of consultative services to businesses and would-be entrepreneurs, all of whom meet the Small Business Administration definition of a small business.
“We work with folks on a wide variety of business issues, whether that’s growing or expanding to another market, management challenges or marketing an existing business,” she says. “It really just depends on the needs of the business, as our consulting services are customized to the needs of the business owner.”
Robinette says it’s not unusual for the organization to deliver a wake-up call or two to the entrepreneurs it works with.
“Business ownership is difficult; business owners face different challenges along the way,” she says. “I think the biggest challenges that we see are business owners being able to tackle and deal with all of those various issues and wear all the hats that they have to wear.”
“We are about helping them identify their goals and priorities and figuring out the best use of their time. There are a lot of good things they can do, but they aren’t going to have time to do them all. They have to be more strategic and think about that approach and make sure that the things that they’re doing are the best things they can be doing to help them accomplish their goals.”
The combination of ready resources and a favorable financial climate hints that the current boom may be in play in Arkansas for a while. Randy Zook says Gov. Asa Hutchinson’s proactive leadership on behalf of the business community and economic development demonstrates the state is serious about making the most of this robust environment.
“It’s a golden time,” says Zook. “The governor certainly has played a leadership role in attracting more and better jobs through his efforts to recruit companies coming into the state and encouraging expansion of existing businesses. His efforts around education and his efforts leading [business] recruiting efforts have been very positive.”
“I heard a senior economist in Washington make a forecast last week that we’ve got at least a three- or four-year runway in front of us for very positive conditions. It’s just a great time to be starting or expanding a business and going into a career.”