The Perryman Report and Texas Letter talks about:
• Jobs – Texas added 39,600 jobs in April for a total of 332,300 jobs over the previous 12 months,
• Energy – Advances in technology in an amazingly short period of time have reduced the cost to produce oil. Three years ago $70 per barrel almost shut down the industry. Today that price accelerates an ongoing surge. Production is so strong that the Permian Basin will run out of pipeline capacity within the next 3 to 4 months until new pipelines can be completed in 2019.
• Business – Texas again winning the top award for corporation location and expansion projects from the Site Selection Magazine.
• Population – Texas is projected to reach a population of 30 million in the next 4 years.
The Federal Reserve of Dallas Texas Employment Forecast projects a whopping 412,600 jobs will be added to the state this year with a job growth rate of 3.3%. The 2018 forecast is significantly above 2017 job growth of 1.9 percent. The Fed’s Leading Index for Texas continues it’s positive three year trend after recovering from the downturn caused by the drop in the price of crude oil.
Texas is almost like a country in itself with 12 economic regions including: High Plains, West, Northwest, Metroplex, Upper East, Capital, Central, Southeast, Upper Rio Grande, Alamo, Gulf Coast and South.
Today I would like to take a look at what we Texans call “the Valley”, to look at our economy and job growth.
The much talked about border towns of Texas are growing, as is the opportunity for jobs. Texas’ South Region is comprised of the 28 counties covering the Gulf Cost and Mexico border and offers a “young, growing workforce”. According to the Texas Comptroller, “the South Region added more than 138,600 jobs from 2004 to 2014, led by Hidalgo County. Its 26 percent job growth accounted for 37 percent of the region’s net new jobs.”
Here is how South Texas ranked against Texas and the US on Job Growth.
Job growth 2004 – 2014
South Texas – 20.1%
Texas – 21.7%
U.S. – 5.5%
In the Texas Comptroller’s Regional Snapshot, they conclude that “The South Region is one of Texas’ fastest growing and most diverse. It overlies a portion of the Eagle Ford Shale that has helped fuel the state’s energy resurgence. It also serves as a hub for shipping, farming and manufacturing. Meanwhile, tourists flock to shoreline destinations such as Corpus Christi and South Padre Island.
The region offers a dynamic workforce. Both birth and graduation rates top state averages. It has also added jobs at a faster rate than Texas as a whole, though wages lag significantly behind the state average. Rapid growth, coupled with drought conditions, has strained the region’s water supplies.
Thriving cities, agriculture and mining helped drive Texas’ largest consumption increase over the past decade. In all, the region offers much promise. It will remain relatively young and culturally dynamic while supporting some of Texas’ key industries.”
Here is the rest of the story from the Comptroller.
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I have said before, 2017 is looking very hopeful – reports are predicting a slow and steady growth. We may not increase at a rate that we have in the past, but we are still on the rise. This is confirmed by the Federal Reserve Bank of Dallas and the Austin American Statesman. The Federal Reserve Bank of Dallas released their Regional Economic data for December 2016, and all major metro business cycles indexes increased, except for a small dip for Houston.
The Austin American Statesman reports that Texas is ready to shift into 2nd gear in 2017. According to AAS, Keith Phillips senior economist of Dallas Fed, reported that, “Texas employers should expand payrolls by 2 percent this year, about 242,000 jobs. While far lower than the state’s long-run average, which typically exceeds national job growth rates, the job gains in 2017 are expected to surpass the estimated 1.6 percent annual growth rate through November of last year.”
Phillips said, “Texas still fared better than most energy states. And the Interstate 35 corridor, particularly Dallas and Austin, remained an exception to the otherwise modest growth in Texas.”
Phillips went on to say, “job growth picked up in the second half of 2016 due to a stabilization of the energy sector,” he said. “With that positive momentum, the Texas economy enters 2017 poised to shift into ‘second gear.”
Hear first hand from Phillips on how our Texas economy will be “slightly better than last year”.
Mine Yucel, Dallas Fed’s director of research, supported this with, “Despite the sharp drop in oil prices that sent the energy industry into a tailspin over the past two years, Texas did not drop into a recession at any point. And the modest recovery in commodity prices has helped stem the bleeding of oilfield services jobs and helped buoy statewide manufacturing outlooks.”
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