Texas Employment Forecast

Texas Financial system

November 18, 2022

The Texas Employment Forecast signifies that jobs will improve 4.3 p.c in 2022, with an 80 p.c confidence band of three.9 to 4.6 p.c. The forecast is a mean of 4 fashions which can be based mostly on projected nationwide GDP, oil futures costs and the Texas Main Index. This estimate is decrease than final month’s projection of 4.4 p.c. The forecast means that 556,000 jobs might be added within the state this 12 months, and employment in December 2022 might be 13.6 million (Chart 1).

Texas employment development decelerated to 2.9 p.c in October after rebounding to 4.8 p.c in September.

“Even with the slowdown in October employment, Texas year-to-date job development is a stable 4.7 p.c,” mentioned Luis Torres, Dallas Fed senior enterprise economist. “Power in October was led by a rise in mining and logging, skilled and enterprise providers, and leisure and hospitality employment. Employment development was broad based mostly; no main industries posted losses.”

The Texas Main Index continued its decline in the three months by means of October (Chart 2). The index elements have been almost all damaging, with weak point led by a decline in help-wanted promoting. An increase in new unemployment claims, and a decline in each the U.S. main index and the actual worth of West Texas Intermediate oil additionally dragged on the index. A rise in common weekly hours labored in manufacturing was a optimistic contributor. The weak point within the main index suggests an additional slowing in job development going into 2023.

Subsequent launch: December 16, 2022

Methodology

The Dallas Fed Texas Employment Forecast tasks job development for the calendar 12 months and is estimated because the 12-month change in payroll employment from December to December.

The forecast is predicated on the common of 4 fashions. Three fashions are vector autoregressions (VARs) the place Texas payroll employment is regressed on West Texas Intermediate (WTI) oil costs, the U.S. main index and the Texas Main Index, respectively. The fourth mannequin is a regression of payroll employment on expectations for U.S. GDP development and WTI oil costs, 4 COVID-19 dummy variables (March–June 2020) and projected Texas COVID-19 hospitalizations from the Institute for Well being and Metrics Analysis.

For extra particulars, see dallasfed.org/analysis/forecast/.