August job gains for the US were disappointing, with an increase in total nonfarm payroll employment of 235,000 and the unemployment rate down 0.2 percentage point to 5.2%. An increase of this magnitude isn't bad by historical standards and is, in fact, somewhat above the average during the 11 years of expansion prior to the pandemic. However, it's not the strong economic recovery from the COVID downturn we would like to see, and it's a far smaller increase than those observed in recent months.
Housing prices are up. Way up! The robust market reflects a variety of factors, including population growth, job opportunities, and interest rates. During the pandemic, demand increased as people looked to upsize to allow more room for at-home work and/or school. Remote work also allowed many households to relocate, while stimulus funds helped many with down payments. At the same time, the pandemic slowed construction due to production shutdowns, logistics bottlenecks, and resulting shortages (and price increases) of some building materials – and a tight labor market didn't help. In other words, in our highly complex modern economy, the basics of supply and demand are alive and well.
Newly released Census data indicates that the US population is becoming increasingly diverse. The most prevalent racial or ethnic group was the White alone non-Hispanic population at 57.8%, down from 63.7% in 2010. The Hispanic or Latino population was the second largest, comprising 18.7% of the total, while the Black or African American alone population was third at 12.1%.
The US Census Bureau continues to release results of the 2020 Census. The information is crucial to effective corporate planning, as well as to understanding the dynamics of the nation’s population and potential policy needs or implications. One recent dataset describes overall population growth and trends in the number of people under age 18.
The US Senate recently passed a $1.2 trillion infrastructure bill in a rare and much needed bipartisan action to inject funds to fix and expand roads, bridges, water systems, the power grid, and other pressing priorities. It will doubtlessly go through some delays, detours, and drama in the House, but seems destined to ultimately make its way to the President's desk and a waiting pen (hopefully sooner rather than later). After a laughable number of "Infrastructure Weeks" in Washington DC for many years, we are finally on the cusp of an "Infrastructure Decade."
Over 40+ years and thousands of projects, I have examined pandemics, natural disasters, oil market collapses, financial meltdowns, and all manner of mayhem. One enduring lesson is that nothing – and I do mean NOTHING – gets folks worked up as much as football. I should know better, but, alas, I don't!
The economic upheaval of 2020 impacted all corners of Texas. As centers of employment, the largest metropolitan statistical areas (MSAs) experienced the bulk of the heavy losses as the state responded to the COVID-19 crisis. About 79.3% of 1.4 million jobs lost between February and April 2020 were concentrated in the state's six largest MSAs. However, recovery is ongoing, with the pace varying depending on industrial composition and other factors. Let's briefly explore the current status of the state's primary population centers and my latest economic projections.
CNBC regularly ranks the top states for business– and the winner was...not Texas! The Lone Star State came in fourth after Virginia, North Carolina, and Utah, all of which compete aggressively and effectively for desirable corporate locations. While fourth is not terrible, it is worse than we normally fare in such listings.
The energy sector remains a key driver of the Texas economy. It dominates state exports; drilling, production, transportation, and processing activity involve substantial investments; and the massive supply chain has been entrenched and expanding for over a century. Although the Texas economy is diverse and multifaceted, oil and gas and related activity from exploration through shipping comprise about 13-14% of overall business activity.
June saw a strong acceleration in the pace of recovery in the job market. Total nonfarm payroll employment in the US rose by 850,000 according to the US Bureau of Labor Statistics, and more than 1.7 million jobs have been gained in the last three months. Since the worst of the decline in April 2020, US employment has risen by 15.6 million. Nonetheless, it remains 6.8 million (4.4%) below the peak in February 2020.