What Is a Good Salary in Arkansas?

What constitutes a “good” salary is a subjective consideration, varying significantly based on an individual’s financial aspirations and desired lifestyle. This determination involves more than just a numerical value; it encompasses factors like the ability to save, manage debt, and engage in discretionary spending. For those considering Arkansas as a place to live, understanding the local economic landscape is essential for evaluating how a particular income level might support their financial objectives. This article explores the various elements that define what a good salary might look like within the state.

Understanding a Good Salary in Arkansas

A good salary in Arkansas is largely about the purchasing power it offers and the quality of life it can support. While a specific income figure might seem modest in a higher-cost region, it can provide a more comfortable existence in Arkansas due to the state’s generally lower expenses. A salary’s true value is determined by how far it stretches in a given economic environment.

Personal financial goals, such as building savings, repaying loans, or funding leisure activities, play a significant role in an individual’s perception of a good salary. For example, a salary that allows for substantial contributions to a retirement account or enables frequent travel might be considered excellent by some. Conversely, a salary that barely covers basic necessities, even if numerically higher than average, may not meet an individual’s definition of good. The interplay between income and local living expenses directly influences an individual’s capacity to achieve these personal financial milestones.

Cost of Living Components in Arkansas

The overall cost of living in Arkansas is generally lower than the national average. This affordability extends across several major expenditure categories. Housing costs, for instance, are notably below the national average. The median home price in Arkansas is considerably lower than national averages, and renting a two-bedroom unit typically costs around $840 to $1,100 per month. Property taxes in the state are also among the lowest.

Utility expenses in Arkansas are also more affordable. The average monthly electricity bill is around $132.18, and the average residential electricity rate is nearly 26.5% below the national average. Natural gas costs are also lower than the national average. While groceries are about 4% less expensive than the national average, residents in Arkansas spend a higher percentage of their income on food due to the state’s lower median household income.

Healthcare costs in Arkansas vary, with some reports indicating they are lower than the national average. Transportation costs are also generally lower, though car insurance premiums can be higher. Vehicle wear due to road conditions can also add to costs.

Key Factors Affecting Salary Levels in Arkansas

Salary levels in Arkansas are influenced by dominant industries, geographical location, educational attainment, and professional experience. The state’s economy is significantly shaped by sectors such as agriculture, aerospace and defense, manufacturing, and logistics and distribution, with major companies like Walmart and J.B. Hunt Transportation Services headquartered in Arkansas. These industries create varying demands for skilled labor, which affects compensation levels.

Geographical location within Arkansas also plays a role in salary differentiation. Urban centers, such as Little Rock, tend to have higher living costs and potentially higher salaries compared to more rural areas. For example, Little Rock’s cost of living index is higher than other areas like Fort Smith. This disparity means that a salary considered “good” in a rural county might be inadequate in a larger city.

Educational background and specialized skills have a direct correlation with earning potential. Occupations requiring a bachelor’s degree are projected to add more jobs, indicating a demand for higher-skilled workers. Professional experience typically leads to increased compensation, reflecting the value employers place on seasoned expertise. The combination of these factors dictates the specific earning potential for individuals across different professions and regions within Arkansas.

Average Salary Data for Arkansas

The average salary data for Arkansas provides a general overview of earning potential within the state. The median household income in Arkansas was $58,773 in 2023. This figure represents the midpoint of all household incomes, with half earning more and half earning less.

These figures are statewide averages and medians, and individual salaries can vary considerably. Factors such as specific job roles, industry sector, education level, and years of experience contribute to a wide range of incomes. Those seeking more granular data can consult resources such as the Bureau of Labor Statistics (BLS) and state labor department websites, which provide detailed occupational wage information and regional breakdowns.

Comparing Arkansas Salaries to Other States

When placing Arkansas’s salary landscape into a broader national context, average earnings are generally lower than the national average. The median household income in Arkansas, at $58,773 in 2023, is about 25% lower than the national median. This places Arkansas among the states with some of the lowest median household incomes.

However, the lower cost of living in Arkansas significantly impacts the effective purchasing power of its residents. While Arkansas’s average weekly wage ranks lower nationally without adjusting for cost of living, it rises considerably when regional price differences are factored in. For example, when adjusted for the cost of living, Arkansas’s average weekly wage has a purchasing power equivalent to $1,195, moving its ranking from 46th to 24th among states. This adjustment highlights that a lower nominal salary in Arkansas can afford a comparable or even better standard of living than a higher salary in a more expensive state.