Over the past couple of years, this nation has grown all too familiar with headlining “bad news,” particularly of the economic nature. However, most economists now agree that the recession is over, and signs are emerging confirming this pattern. Even so, the economic downturn experienced over the previous almost two years continues to linger as the nation steps out of the worst recession seen in generations towards recovery.
Not unusual to early stages of recovery periods, the nation will be characterized by mixed signals and the daily ebb and flow of information is expected to point in many directions for some time. One major signal of the strength of the economy is job growth. However, hiring is consistently one of the last indicators to turn positive during a recovery as employers have to feel confident that the upturn has staying power before committing to new jobs.
As a nation, we have yet to see indications that the economy is to this point. In fact, employment numbers for last month (October) indicate that there was continued decline throughout the United States, a loss of some 190,000 jobs. Likewise, the unemployment rate increased to 10.2% in October. However, the average number of people losing their job per month is declining; even so, some 15.7 million Americans are unemployed.
In Texas, the affects of the recession have been less severe than other states, and recovery is likely to be quicker. The Texas economy, somewhat sheltered from the recession from the onset due to a strong energy sector in a time of high oil and natural gas prices as well as a more stable housing market, appears to be leading the way in the recovery showing employment gains above all other states this past month.
Texas total nonagricultural employment grew by 41,700 positions in October of this year. In addition, the Texas unemployment rate was 8.3%. While still higher than the unemployment rate in October of last year (5.2%), the rate is significantly lower than the national average.
From September to October, five states, including Texas and the District of Columbia, saw employment gains including Michigan (38,600), California (25,700), Oklahoma (8,800), District of Columbia (5,400), and Montana (3,200). Although it is far too early to deem job growth a trend in any of these states, and, in fact, continued job losses can be expected, even single months of job creation signal that we are making progress down the road of recovery, and Texas is leading the way (the state also saw growth in a single month during the summer).
Like the nation as a whole, key growth sectors in Texas this past month were Education and Health Services (adding some 14,900 jobs) and Professional and Business Services (10,800). However, unlike the national employment numbers, Texas also saw positions added in some other key sectors. The Financial Activities industry grew by 4,500 jobs; Leisure and Hospitality saw an additional 2,600 jobs; and Trade, Transportation and Utilities reportedly increased by 2,500 positions from September to October of this year.
These recent numbers indicate that employment growth in the state has been broad based spanning several sectors. In fact, the only industries that showed employment losses from September to October were Construction and Manufacturing, although job employment losses in Manufacturing were considerably less then previous months. Growth in numerous sectors is encouraging, pointing to the strength of the Texas economy and its future potential.
While one month’s employment growth numbers do not indicate that rough economic times are completely over in the Lone Star State, they do mean that, unlike many other states, Texas can headline “good news” this month—a significant feat in the early stages of economic recovery. Although continued ups and downs can be expected, it is apparent that Texas is in a “last in, first out” position as the transition to recovery occurs.