innovate arkansas

The specter of economic doom and gloom that has dominated the national scene recently isn't so apparent in Arkansas, according to a discussion at the University of Arkansas at Little Rock's Economic Forecast Conference.

Representatives of the state's aviation, steel and natural gas industries provided an optimistic outlook at Tuesday's conference at the Hilton Hotel in Little Rock.

One of the largest and most apparent economic boons in the state has been the Fayetteville Shale Play.

Danny Games, director of corporate development for Chesapeake Energy Corp., said his company has 600,000 acres and 14 rigs in Arkansas. Chesapeake expects to expand to 25 rigs within the next year, he said. The firm also has identified 5,700 potential drilling locations.

With the ability to drill only 300 wells a year at $3 million each, Games said he expects natural gas to be a key economic contributor in Arkansas for the next 30 to 40 years.

A study conducted by the University of Arkansas at Fayetteville forecast the economic impact at about $18 billion, creating 11,000 jobs. But Chesapeake CEO Aubrey McClendon recently projected that natural gas companies will spend between $75 billion to $100 billion over the next decade.

Robert Smith, senior vice president of industrial programs for Dassault Falcon Jet, said the aviation industry is experiencing "good times like never before seen." One obvious indicator: new orders for planes are expected to take until 2013 to fill.

"International demand has more than compensated for the slow U.S. economy," Smith said.

Lexicon Inc. Chairman and CEO Thomas Schueck said conditions are favorable for Lexicon companies as well. Those companies include Schueck Steel, Prospect Steel and Custom Metals.

"No recession here," he said.

Help Wanted

Despite the encouraging forecast, panelists lamented the lack of skilled workers.

Randy Zook, deputy director of administration and finance for the Arkansas Economic Development Commission, referred to it as the "skills gap."

"This is a chronic problem across the state," Zook said.

About 5 percent of workers in Arkansas - about 75,000 people - are unemployed. But the availability of jobs, Zook said, isn't the problem.

"The problem is that the people who are unemployed don't have the skills to do the jobs," he said.

Dassault employs about 2,500 workers in the state and has 200 more openings.

"With such a strong backlog, we must sustain an experienced, skilled workforce," Smith said. "It has not been easy for us."

The lack of skilled workers in Arkansas forces the company to look out of state to fill those jobs, particularly engineering and professional positions.

"It is important that we move ahead with education and training to supply the needs of our industry," Smith said.

Both Smith and Schueck suggested that the state put more emphasis in vocational programs at the high school level.

Zook said 125 companies have opened or expanded in Arkansas since January 2007, creating more than 8,000 jobs and $2.3 billion in capital investments.

National Forecast

The panel discussion was preceded by a presentation on the national economic forecast by Thomas Goho, co-director and faculty member of Stephens University at Wake Forest University in Winston-Salem, N.C.

Goho said the state of the national economy is fairing better than some might think. Among the indicators he referenced was a gross domestic product of $14.4 trillion that is growing at 3 percent and "strong balance sheets" among major financial institutions.

"I now believe that there is light at the end of the tunnel," Goho said.