Post Date: 05/18/2017
Texas knows from repeated experience how to recover from a recession. By GDP, its economy is the second largest in the U.S. and the Lone Star State would rank 10th in the world economy if it were a sovereign country. Texas also has a robust job market and since 2007, its economy outperformed most states with employment and population increases 10% higher than the nation as a whole. Using data and statistics from the Q1 2017 reports published by the Texas Workforce Commission, the Texas A&M Real Estate Center, and the Federal Reserve Bank of Dallas, we can see how the Texas job market stacks up locally and nationally.
According to the Bureau of Labor Statistics current survey, the March 2017 unemployment rate for Texas was 5% which was 0.5% higher than the national rate of 4.5%. However, the state’s labor force continues to grow as new residents move to Texas. This means a 5% unemployment rate should not be cause for alarm. The increase in unemployment can also be attributed to the rising labor force participation rate, which rose for the second month to 63.8%. Monthly initial unemployment insurance claims fell 3.9% to their lowest number since 2008.
All of the major Texas metros reported hourly earnings above the state average. Earnings in Austin, Houston and Dallas also exceeded the national average, in some cases by more than 8%. Real manufacturing employee hourly earnings were 10.6% higher in Texas than across the country. Fort Worth had the highest manufacturing wages, paying 55.9% higher than the statewide average. Average hourly earnings of private sector employees showed an increase of 5 cents, which follows a 7-cent gain in February. Hourly earnings are up 2.7% over the year.
Texas has learned the importance of a diverse economy by surviving and rebounding from numerous boom and bust cycles. Recent corporate relocations and expansions represent a cross-section of industries including automotive manufacturing, technology, petrochemicals, distribution centers, financial services, health care and aerospace, to name just a few. Here is a look at two high performing sectors for job growth in Texas:
- Mining and Logging Jobs (Energy) – The number of operating oil rigs in Texas increased to over 400, the most since August 2015. Support activities for mining added 4,800 jobs in March and over 10,000 jobs since January, which is the strongest Q1 gain since 1990. The Permian Basin, one of the top oil plays in the country, spreads across much of western Texas and the southeastern corner of New Mexico and has been steadily adding new rigs. Companies such as Apache and Occidental Petroleum have been making significant investments in the area and Houston-based Halliburton announced plans to hire more than 200 people for its Permian Basin operations.
- Manufacturing – Manufacturing added 1,700 jobs, two-thirds of which came from durable goods. The most recent Texas Manufacturing Outlook Survey conducte d by the Federal Reserve Bank of Dallas reported increased factory activity and output levels as well as upward movement in demand levels. Survey results also saw prices and wages continue to rise.
2017 started strong with Texas adding 53,700 jobs in January. Although job growth in February and March slowed, economists still predict a solid 2017 performance. The Dallas Fed raised its annual growth forecast from 2.3% last month to 2.4%, which is a significant improvement over the 1.7% growth seen in 2016.
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