Business Forecast Luncheon Highlights Economic Outlook for 2026

The Sam M. Walton College of Business' Center for Business & Economic Research (CBER) hosted the 32nd Annual Business Forecast Luncheon on Jan. 30, bringing together business leaders, policymakers and community members to examine the economic trends shaping 2026.

The event featured keynote remarks from Alberto Musalem, president and CEO of the Federal Reserve Bank of St. Louis, alongside economic forecasts from Mervin Jebaraj, director of CBER. The program was moderated by Matuschka Lindo Briggs, senior vice president and regional executive of the Little Rock Branch of the Federal Reserve Bank of St. Louis.

In his presentation, Jebaraj predicted moderate world economic growth for 2026-27, driven by the current flurry of economic activity in the AI space. However, reliance on growth from a single sector means that a correction in that market could reverberate not just in the U.S. but across the world. Meanwhile, trade uncertainty with the U.S. continues to weigh on Mexico and Canada, while India is expected to remain the world's fastest-growing large economy.

Turning to the U.S., Musalem described the economy as "resilient, with considerable momentum coming into 2026." Strong consumer spending and a steady labor market are expected to support continued growth. With unemployment near the level associated with full employment and inflation projected to resume a path toward the Federal Reserve's 2% target, Musalem expressed optimism that economic conditions remain favorable despite potential risks tied to a weak housing market.

In his regional forecast, Jebaraj noted that the Arkansas economy is growing at just over 3%, when measured without the agricultural sector. While ag and construction faced challenges in 2025, sectors such as healthcare and leisure/hospitality continue to expand, particularly in central Arkansas. The state is predicted to add approximately 13,000 new jobs in 2026.

Northwest Arkansas remains one of the fastest-growing regions in the state, adding an estimated 28 residents per day. Although population growth is expected to slow slightly, housing affordability remains a key concern, as home prices and mortgage rates remain elevated. Cities will need zoning improvements and increased infrastructure investment to support future growth.

Musalem described his outlook for Northwest Arkansas as one of "cautious optimism," noting continued job growth in professional business services, healthcare and leisure/hospitality. He highlighted the region's national and global economic influence as a source of insight for policymakers.

For a more detailed recap of the event, click here.

About the Center for Business and Economic Research: CBER is a public service outreach organization whose mission is to serve its constituents with the highest quality research support, basic and applied business and economic analysis, and timely, relevant business, economic and related public policy information, as well as other outreach activities. In addition to supporting research within the college, the center supports economic development by providing economic and demographic data and analysis to business, government and individuals. The center actively works with the economic development community of the state to build Arkansas' capacity to create high-wage, high-skill employment.

About the Sam M. Walton College of Business: Founded in 1926, the Sam M. Walton College of Business stands as one of the largest colleges at the University of Arkansas, serving over 10,300 students across undergraduate, master's and doctoral programs. The college holds AACSB accreditation and consistently ranks among the top business schools in the United States. Walton College ranks 25th for its undergraduate business program among public colleges in the U.S. News & World Report's 2025 national rankings. Its undergraduate supply chain management program is recognized as the top program in North America by Gartner. In 2025, The Princeton Review included Walton's M.B.A. program in its Best Business Schools list for On-Campus M.B.A. Programs.