Although the daily headlines may reflect such matters as the oil spill in the Gulf of Mexico or the World Cup taking place in South Africa, there is one topic that is rarely off the interest radar for most Americans. That subject matter, of course, is employment.
The level of concern about jobs has risen substantially since the recession began in December 2007. Over the past couple of years, it seems that almost every news cycle brought the topic closer and closer to home as Texans, as well as people across America, heard about layoffs, business closings, foreclosures, rising unemployment, and belt tightening due to worsening economic conditions.
Within a year after the word “recession” had entered our daily conversations, the number of unemployed had climbed from 7.7 million to approximately 11.1 million and the nation’s unemployment rate had risen from 5.0% to 7.2%. By December 2009, the number of people without jobs had grown to some 15 million while the unemployment rate hovered around 10.0%.
Over the past five months, the economic skies have brightened, though there are still shadowy clouds on the horizon. In May, according to the Bureau of Labor Statistics, about 431,000 workers were added to the nation’s wage and salary payrolls, reflecting the fifth consecutive month of job growth. Unemployment was at 9.7%, the same rate as the first three months of the year. Unfortunately, much of that growth was in temporary Census workers, but the national employment picture has improved some in recent months.
For the Lone Star State, the employment data released this past week was even more pleasant. Throughout the recession, Texas has fared somewhat better than many areas and the 43,600 jobs added in May, the fifth consecutive month of positive growth, indicates that this pattern is continuing.
In January, Texas was cited by the Department of Labor as the state with the largest growth in private sector jobs among all states for the previous decade. From December 1999 to December 2009, about 724,300 net private sector jobs were created, a 9.30% overall gain. During this same period, the US experienced a 1.41% private employment loss.
The substantial job hike in May gave Texas the largest over-the-month increase in wage and salary employment among all states. California, New York, Florida, and Virginia followed with the number of added workers varying from 28,300 to 20,300. Thirty-six other states also experienced positive job growth in May.
Preliminary data just provided by the Bureau of Labor Statistics indicate that in the past 12 months, several Texas industries achieved positive net employment gain. They include professional and business services, education and health services, leisure and hospitality, and government. In fact, this is the first year-over-year gain in quite some time.
Last month in Texas, jobs were added in nine major industries with professional and business services achieving a fifth straight job gain. Other notable increases in workers were realized by leisure and hospitality and trade, transportation, and utilities industries. This broad expansion is in sharp contrast to the US and its reliance on short-term federal positions.
With approximately 11.2 million Texans currently employed, the most in the history of the state, the unemployment rate remained at 8.3% last month, well below the nation’s 9.7% status. Other state unemployment rates for May ranged from 3.6% (North Dakota) to 14.0% (Nevada). Eight states had unemployment rates significantly higher than the nation as a whole.
Since the beginning of 2010, about 114,100 new jobs have been created across the Lone Star State. Such ongoing employment growth is certainly good news for Texas and likely marks the onset of ongoing expansion at a reasonable pace for the foreseeable future.
posted @ 08:05 AM CST [link]
Friday, June 18, 2010
Rising from the Ashes
Sometimes it really is darkest before the dawn!! Such was the case with the recent announcement that the Big 12 will continue to exist (though possibly with only 10 universities) and likely even prosper more than in the past despite a flurry of activity and numerous pronouncements of its demise.
The positive economic effects of college athletics stem from ticket sales and visitor spending as well as hosting games. Schools in premier conferences also realize notable benefits such as national exposure and lucrative media contracts.
In recent days, predictions of the death of the Big 12 conference were rampant, and funeral plans were reluctantly being considered. Fortunately, thanks to the leadership and personal involvement of state legislators, university administrators, regents, coaches, donors, friends, and alumni from numerous institutions, as well as league officials, such arrangements are no longer necessary.
Although full details have yet to be finalized, it appears that the new 10-team Big 12 alignment will prove financially beneficial to all participants and significantly enhance the economy of the State of Texas. It will be a couple of seasons before the conference gets its fresh look, but when it does, the $11.58 million each school is expected to receive for the 2009-2010 academic year from TV revenue will be eclipsed by the projected $17 million Big 12 participants will be awarded beginning in 2012. In addition to that amount, each university is allowed to set up its own TV network to reap even greater financial remuneration.
College sporting events bring millions of people together every year to watch and support their teams. In the case of the Big 12, with four of its 10 members in Texas (University of Texas at Austin, Texas A&M, Texas Tech, and Baylor), the impact on local and state economies of home games is quite substantial, especially in the travel, hospitality, and restaurant sectors.
Besides season games, major games such as bowl games or basketball’s Sweet Sixteen or Elite Eight produce notable local economic stimulus and major television exposure for participating schools. A greater number of Texas teams participating in any conference preserves high-impact, in-state rivalries and will give Texas a better chance of hosting large sporting events which lead to tens of millions of dollars in economic impact. Under almost any scenario that was being contemplated, Texas would have lost (1) at least one representative in a major conference (and the corresponding revenues), (2) several high-profile games within the state, and (3) prospects for post-season events.
Keeping the Big 12 alive will enable member schools to still reap significant benefits from television exposure throughout the year in terms of recognition, prestige, student recruitment, and funds available for athletic programs. In addition to benefits to university athletic budgets, participation in premier NCAA Football Bowl Subdivision (FBC) conferences, of which the Big 12 plays a major role, furthers the reputation and academic competitiveness of participating schools.
Member schools of athletic conferences often collaborate in myriad academic ventures through voluntary consortiums. Faculty and student association with other Big 12 members seriously enrich opportunities to build broad communities, share knowledge and resources, and positively impact educational and research ambitions of all universities involved.
It is fortunate that the Big 12 will continue, especially for the remaining schools and for the Texas economy. My firm looked at the potential net annual losses to Texas if what was deemed the most likely scenario at one point in the process had indeed occurred. We found substantial negative effects as the balance shifted adversely for Texas representation relative to other states and programs were relegated to less prestigious status. In fact, we estimated that Texas could lose $714 million in annual total spending in the economy, nearly $372 million in annual output (gross product), and 5,764 full-time equivalent jobs. In addition, the State government would lose more than $19 million in tax revenue each year associated with this foregone economic activity.
While there is still some uncertainty as to the exact structure of the Big 12 going forward, it is clear that the presence of four schools in a premier conference is important to Texas’ ability to capitalize on the potential economic stimulus of college athletics and to reap other benefits as well. I like it when a plan comes together, even at the last minute.
posted @ 08:01 AM CST [link]