Your Texas Economy Last updated: January 30, 2018
Texas economy strong in 2017 2017 job growth was 2.4% Overview 2015/2016 job growth was much weaker due to the oil bust (1.3% and 1.2%, respectively) 2014 job growth was 3.7%, strong due to the oil boom 1991 2016 average job growth was 2.0% Texas expected to grow faster in 2018 Job growth forecast at 2.8% (Dec./Dec.) 2
Job growth (percent), Dec./Dec.* 5 4 3 2 1 0-1 -2-3 -4-5 Texas Job Growth Robust in 2017 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 *Seasonally adjusted, annualized rate. SOURCES: Bureau of Labor Statistics; Texas Workforce Commission; seasonal and other adjustments by FRB Dallas. DATA: https://www.dallasfed.org/research/econdata/tae000000.aspx TX 2.4 U.S. 1.4 3
Texas Job Growth Rebounds in Q4, after Hurricane Harvey Job growth (percent), quarter/quarter* 5.0 4.5 4.0 3.5 3.0 2.5 2.0 1.5 1.0 0.5 0.0 2014 2015 2016 2017 *Seasonally adjusted, annualized rate. SOURCES: Bureau of Labor Statistics; Texas Workforce Commission; seasonal and other adjustments by FRB Dallas. DATA: https://www.dallasfed.org/research/econdata/tae000000.aspx 4
Energy Sector Job Growth Rebounds in 2017 Job growth (percent), Dec./Dec.* 15 2015 2016 10 2017 5 0-5 -10-15 -20-25 Trade, Transp. & Util. (19.9%) Prof. & Bus. Serv. (13.7%) Educ. & Health Serv. (13.6%) Leisure & Manufacturing Hosp. (10.8%) (7.0%) Fin. Act. (6.2%) Constr. (5.9%) Oil & Gas Extract., Mining Sup. (1.8%) *Seasonally adjusted, annualized rate. NOTE: Numbers in parentheses are share of state employment accounted for by each sector. SOURCES: Bureau of Labor Statistics; Texas Workforce Commission; seasonal and other adjustments by FRB Dallas. DATA: https://www.dallasfed.org/research/econdata/tx-emp-ind.aspx 5
Job growth (percent), Dec./Dec.* 5 Job Growth Uneven Across Metros 2015 2016 2017 4 3 2 1 0-1 Austin Dallas Fort Worth Houston San Antonio *Seasonally adjusted, annualized rate. SOURCES: Bureau of Labor Statistics; Texas Workforce Commission; seasonal and other adjustments by FRB Dallas. DATA: https://www.dallasfed.org/research/econdata/tx-emp.aspx#tab3 6
Texas Unemployment Rate Below U.S. Level Unemployment rate (percent)* 12 10 U.S. 8 6 4 2 Texas 4.1 3.9 0 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 NOTE: Data through Dec. 2017. SOURCES: Bureau of Labor Statistics; Texas Workforce Commission; FRB Dallas. DATA: https://www.dallasfed.org/research/econdata/txu.aspx 7
Jobs (millions)* 13 Job Outlook: Solid Growth Dallas Fed Employment Forecast 12 11 10 9 Texas job growth expected to be about 2.8% in 2018 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 *Seasonally adjusted. NOTES: Observed employment data through Dec. 2017. Upper and lower dashed lines represent the 80 percent confidence bands around the forecast. SOURCES: Bureau of Labor Statistics; Texas Workforce Commission; FRB Dallas. DATA: http://www.dallasfed.org/research/forecast/index.cfm 8
ENERGY Texas is #1 producer of oil and natural gas in nation 25% of U.S. refinery capacity and 60% of U.S. petrochemical production is in Texas Low energy prices hurt Texas economy on net
Dollars 160 140 120 100 80 60 40 20 0 Energy Activity Strengthened in 2017 Natural Gas Price Oil Price 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 NOTES: Oil price is dollars per barrel. Natural gas price is dollars per million Btu, multiplied by 10. Data through Jan. 2018. SOURCES: Wall Street Journal; Baker Hughes; U.S. Energy Information Administration; Haver Analytics. Texas Rig Count Rig Count 1000 900 800 700 600 500 400 300 200 100 0 10
MANUFACTURING Texas produces 10% of U.S. manufactured goods Manufacturing sector highly correlated with economic growth Dallas Fed s Texas Manufacturing Outlook Survey offers early look at turning points and insight on trends
Index, 3-month moving average* 30 20 10 0-10 -20-30 -40-50 -60 Expansion Contraction Manufacturing Sector Expansion Continues Texas Recession Production Oil Bust 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 *Seasonally adjusted. NOTE: Data through Jan. 2018. SOURCE: Federal Reserve Bank of Dallas Texas Manufacturing Outlook Survey (TMOS). DATA: https://www.dallasfed.org/research/surveys/tmos 12
EXPORTS Texas is the top exporting state and accounts for 17% of U.S. exports Gulf coast ports are major exporters of oil products and petrochemicals Texas-Mexico border ports also process over half of state exports
Index, Jan. 2007=100* 180 160 140 Texas Exports Recover after Energy Bust Mexico is Texas top trading partner, receiving almost 40% of state exports Texas 120 100 U.S. minus Texas 80 60 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 *Seasonally adjusted. NOTES: Underlying data in 2016 dollars; data through Nov. 2017. SOURCES: U.S. Census Bureau; Wisertrade; Bureau of Labor Statistics; seasonal and other adjustments by FRB Dallas. 14
300 250 200 150 100 50 Petroleum Product Exports Still Strong Index, Q1:2007=100* 500 Petroleum and Coal Products 450 Computers and Electronics 400 Transportation Equipment Chemicals 350 Machinery 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 *Seasonally adjusted. NOTES: Underlying data in 2016 dollars; data through Q3 2017. SOURCES: U.S. Census Bureau; Wisertrade; Bureau of Labor Statistics; seasonal and other adjustments by FRB Dallas. Petroleum & coal products and computer & electronics export categories each account for 16% of Texas exports 15
SERVICES Service industry makes up the bulk of the Texas economy Accounts for over 60% of private-sector activity in Texas Dallas Fed s Texas Service Sector Outlook Survey provides timely insight into this key sector
Index, 3-month moving average* 40 30 20 10 0-10 -20-30 -40-50 -60 Service Sector Continues its Steady Expansion Expansion Contraction Texas Recession Services Revenue Oil Bust 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 *Seasonally adjusted. NOTE: Data through Jan. 2018. SOURCE: Federal Reserve Bank of Dallas Texas Service Sector Outlook Survey (TSSOS). DATA: https://www.dallasfed.org/research/surveys/tssos 17
Index, 3-month moving average* Expansion 40 30 20 10 0-10 -20-30 -40-50 -60 Contraction Texas Recession Retail Sales Growth Abates Retail Sales Services Revenue Oil Bust 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 *Seasonally adjusted. NOTES: Data through Jan. 2018; the TROS is a component of TSSOS using information only from retail and wholesale sectors. SOURCES: Federal Reserve Bank of Dallas Texas Service Sector Outlook Survey (TSSOS) and Texas Retail Outlook Survey (TROS). DATA: https://www.dallasfed.org/research/surveys/tssos 18
HOUSING Texas avoided the house price bubble Housing sector was slow to recover Housing markets currently tight in most of the state
Home Sales Bounce Back, Inventories Remain Low Total existing home sales* Months in inventory* 35,000 9 Home sales 8 30,000 7 25,000 20,000 15,000 Inventory 6 5 4 3 2 1 10,000 2000 2002 2004 2006 2008 2010 2012 2014 2016 *Seasonally adjusted. NOTE: Data through Nov. 2017. SOURCES: Multiple Listing Service; seasonal and other adjustments by FRB Dallas. 0 20
280 260 240 220 200 180 160 140 120 100 Texas Median Home Price at Record High Dollars (thousands), four-month moving average* 300 2000 2002 2004 2006 2008 2010 2012 2014 2016 *Seasonally adjusted. NOTES: Data in real dollars; data through Nov. 2017. SOURCES: Multiple Listing Service; seasonal and other adjustments by FRB Dallas. Metro Area Nov. Price Y/Y % Change Austin $296,815-0.3% Dallas $285,919 4.3% Ft.Worth $225,076 8.2% Houston $231,389-1.8% San Antonio $218,292 5.0% U.S. Texas 21
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