- Austin added 25,400 net new jobs, growth of 2.4%, in the 12 months ending in May, making Austin the 11thfastest growing major metro.
- Wholesale trade grew by 6.9% (3,400 jobs), making it Austin’s fastest growing industry, while professional and business services added the most jobs, 8,500 (or 4.6%), over the last 12 months.
- Austin's seasonally adjusted unemployment rate is 2.5%, down from 2.6% in April.
The Austin metropolitan area added 25,400 net new jobs, or 2.4%, in the 12 months ending in May, according to Friday's releases of preliminary Current Employment Statistics (CES) payroll jobs numbers by the Texas Workforce Commission (TWC) and the U.S. Bureau of Labor Statistics (BLS).
Austin’s 2.4% growth makes it the 11th best performing among the 50 largest metro areas. Dallas and Houston, gaining 3.4% and 2.6% respectively, made the top ten. San Antonio and Fort Worth, gaining 1.8% and 1.7% respectively, ranked 22nd and 25th. [See a "Sidebar" at the end of this page for comments about signals that the monthly CES estimates may be currently understating job growth in Austin.]
For the year ending in May, private sector growth in the Austin MSA is 2.8%, or 24,900 jobs, with all private industry divisions adding jobs. Austin's sizable government sector (17% of jobs) grew by only 500 jobs or 0.3%, thus bringing the overall growth rate to 2.4%.
Texas also saw net private sector job growth of 2.8% with all private industries, but two, adding jobs over the last 12 months. Total job growth was 2.4% as the government sector, which accounts for nearly 16% of total state employment, saw slight growth (0.5%). For the nation, private sector growth is 1.7% for the 12 months ending in May with all private industries, but two, adding jobs. Overall job growth is a more modest 1.5% because of minor (0.4%) government sector growth.
Jobs in May are up from the preceding month by 7,700 jobs or 0.7% in the not-seasonally-adjusted series for Austin. In the seasonally adjusted series, growth is also positive, up by 4,000 jobs or 0.4%. Seasonally adjusted jobs are up by 0.3% in Houston, 0.2% in Dallas, 0.1% in Fort Worth, and down by 0.1% in San Antonio. Statewide, seasonally adjusted jobs are up 19,600 or 0.2%. Nationally, seasonally adjusted jobs are essentially unchanged from April.
In Austin, professional and business services added the most jobs, 8,500 (4.6%), over the last 12 months. The fastest growing industry was wholesale trade which grew by 6.9% or 3,400 jobs. Also growing at faster-than-average rates are information (4.9% or 1,600), construction and natural resources (4.2% or 2,700), and financial activities (4.2% or 2,600).
Statewide, construction and natural resources grew fastest (by 4.9%) over the last 12 months. Other relatively fast growing industries included wholesale trade (4.3%), other services (3.6%), manufacturing (3.2%), and professional and business services (3.2%). Information and retail trade jobs fell by 1.4% and 0.3% respectively.
Nationally, construction and natural resources grew fastest, adding 2.8% over the 12 months ending in May. Leisure and hospitality (2.5%); education and health services (2.5%); transportation, warehousing, and utilities (2.4%); and professional and business services (2.3%) were also relatively fast growing. Information and retail trade lost jobs (1.6% and 0.7% respectively).
The net gain for private service-providing industries in Austin is 21,200 jobs, or 2.8%, over the last 12 months. Employment in goods producing industries is up by 3,700 jobs or 3.0%. Statewide, private service-providing industries are up 214,400, or 2.5%, and goods producing industries are up 76,100 jobs, or 4.1%.
We also now have May labor force, employment, and unemployment numbers for Texas and local areas in Texas. The same data for all U.S. metros will not be released until July 3. In April, Austin had the fourth lowest rate of unemployment among the 50 largest metros (lower rates prevailed in San Francisco, Nashville, and Boston).
Unemployment numbers for May show Austin’s performance relative to the state and other major Texas metros being sustained. In May, Austin is at 2.2%, while the other major metros range from 2.6% in San Antonio to 3.2% in Houston. Dallas and Fort Worth are at 2.7%. Austin’s rate one year ago was 2.7%. The rates in the other major Texas metros are also improved from a year ago. The statewide not-seasonally-adjusted rate is now 2.9%, down from 3.6% in May of last year. The national unemployment rate is 3.4%, improved from 3.6% a year ago.
Within the Austin MSA, Travis County has the lowest unemployment rate in May, at 2.1%, while Caldwell County has the highest at 2.8%. The rate is 2.3% in Hays County, and 2.4% in Williamson and Bastrop Counties.
On a seasonally adjusted basis, Austin’s May unemployment rate is 2.5%, down from 2.6% in April. The statewide seasonally adjusted rate is 3.5% in May, down from 3.7% in April. The national rate is 3.6% in May, unchanged from April.
Among Texas’ major metros, San Antonio has the next lowest seasonally adjusted rate at 2.8%, Dallas and Fort Worth are at 3.0% and Houston is at 3.5%. Each metro’s rate is improved from April, except Houston, which is unchanged. Seasonally adjusted unemployment rates for Texas metros are produced by the Federal Reserve Bank of Dallas. (The TWC also produces seasonally adjusted rates for Texas metros, but publication lags the Dallas Fed’s data.)
With Austin’s unemployment rate down from one year ago, the number unemployed has also fallen. In May 2018, Austin’s number of unemployed was 32,149. Over the last 12 months, the unemployed declined by 5,183 or 16.1%, to 26,966. This is due to a larger increase in the number employed, compared to labor force. The Austin metro’s civilian labor force (employed plus unemployed) increased by 16,896 persons or 1.4% from one year ago, while persons employed increased by 22,079 or 1.9%.
Texas’ employment growth (245,939 or 1.8%) also exceeds labor force growth (155,910 or 1.1%). Thus, the number of unemployed decreased by 90,029 or 18.1%. Nationally, May civilian labor force is up by 890,000 or 0.6%, while employed is above the level of a year ago by 1,143,000 or 0.7%, and 253,000 fewer people (18.1%) are unemployed.
The Chamber’s Economic Indicators page provides up-to-date historical spreadsheet versions of Austin, Texas and U.S. data for both the Current Employment Statistics (CES) and Local Area Unemployment Statistics (LAUS) data addressed above.
Last month’s release of this CES data coincided with the release by TWC of an update to an alternative payroll jobs dataset, the Quarterly Census of Employment and Wages (QCEW). QCEW informs the annual benchmark revisions to the CES data and QCEW gives some evidence that Austin’s recent job growth may be more robust than preliminary CES data indicates. We wrote about these conflicting signals last month here (see the article’s third and fourth paragraphs, and associated footnotes).
The Federal Reserve Bank of Dallas produces a version of nonfarm payroll jobs that benchmarks to QCEW data quarterly instead of annually. Their series now reflects the latest quarter (2018 Q4) of QCEW. According to the Dallas Fed’s early-benchmarked and seasonally adjusted data, Austin’s job growth for the year ending in May is 3.1%, which is substantially higher than the BLS/TWC estimate of 2.2% in their seasonally adjusted series (year over year growth in the not-seasonally-adjusted data is 2.4%).
Due to issues of timeliness and for comparison to other geographic areas, this article, like most reporting elsewhere, remains focused on the BLS/TWC CES data, but it can be helpful to be aware of the limitations of the sample survey and the potential for actual growth to be higher or lower than preliminary estimates indicate. Also see April’s jobs article for a comparison of Austin’s preliminary and revised CES estimates.
As a relatively fast growing metro, it may be that the sample survey of employers in our area sometimes becomes insufficiently representative. With unemployment as low as it has been in Austin over the last couple of years, it is reasonable to expect job growth to slow, but with the divergence between CES and QCEW data we see in 2018 Q4, there is some room to question if growth is currently quite as low as 2.4%.
Note that the Excel file of nonfarm payroll jobs time series data on the Chamber’s Economic Indicators page includes not only the CES data (total, private, and major industry sectors), but also the QCEW series (total and private industry), and the seasonally adjusted and early-benchmarked Dallas Fed series (total).
Related Categories: Central Texas Economy in Perspective