Austin Chamber

August 25, 2015 – Job Growth & Unemployment

Posted By Beverly Kerr | Aug 25, 2015
Central Texas Economy in Perspective Print Article Austin Chamber
  • Austin added 32,500 net new jobs, or 3.6%, in the 12 months ending in June, making it the twelfth fastest growing major metro.

  • Seasonally adjusted job growth from June to July was 0.4% and growth has been positive for 67 of the last 70 months.

  • The number of unemployed declined by 11,355 or 23.7% since last July.

  • At 3.2%, seasonally adjusted unemployment is up from 3.1% in June, but otherwise remains at its lowest level since before the early 2000s "dot-com" recession.

The Austin metropolitan area added 32,500 jobs, or 3.6%, in the 12 months ending in June, according to Friday’s release of payroll jobs numbers by the Texas Workforce Commission (TWC) and the Bureau of Labor Statistics (BLS). Austin’s 3.6% growth makes it the twelfth best performing among the 50 largest metro areas. Dallas grew by 4.1%, ranking fifth. The other major Texas metros missed the top 10. San Antonio grew by 3.2% (19th), Fort Worth grew by 2.8% (26th), and Houston grew by 2.2% (36th) between July 2014 and July 2015.

For the year ending in July, private sector job growth in the Austin MSA is 4.1%, or 30,600 jobs, and with all private industry divisions, except manufacturing, contributing to the growth. Austin's sizable government sector (nearly 19% of jobs) saw modest growth over the last 12 months, gaining only 1,900 jobs or 1.2%, thus bringing the overall job growth rate to 3.6%.

Texas saw weaker net private sector job growth of 2.7% with all private industry divisions, except manufacturing, adding jobs over the last 12 months. As with Austin, total job growth statewide is lower, 2.5%, due to the only moderate growth (0.9%) in the government sector, which accounts for over 16% of total state employment. For the nation, private sector growth is 2.4% for the 12 months ending in July, with all private industries adding jobs. Overall job growth is a more modest 2.1% because the government sector gained only 0.4%.

Jobs in July are down from the preceding month by 4,700 jobs or 0.5% in the not-seasonally-adjusted series for Austin, however, June-to-July change on a seasonally adjusted basis is up by 3,700 jobs or 0.4%. Statewide, seasonally adjusted jobs are up 31,400 or 0.3%. On a seasonally adjusted basis, jobs are up 0.7% in San Antonio, 0.5% in Fort Worth, and 0.3% in Houston. Jobs declined in Dallas by 0.3%. Nationally, seasonally adjusted jobs rose 0.2% in July. Austin's job growth has been positive for 67 of the last 70 months (since October 2009).

In Austin, the industry adding the most jobs is professional and business services which grew by 9,500 jobs or 6.3%, over the last 12 months. The industry with the largest rate of growth is leisure and hospitality, which is up 7.5% or 8,100 jobs. Also growing at faster-than-average rates are transportation, warehousing and utilities (5.3% or 800 jobs) and education and health services (5.2% or 5,500 jobs). The manufacturing sector lost 600 jobs or 1.0%.

Statewide, leisure and hospitality grew fastest and added the most jobs, 6.0% or 73,100 jobs. The other relatively fast growing industries were education and health services (up 4.3%); professional and business services and transportation, warehousing and utilities (both up 3.5%); and retail trade and wholesale trade (both up 3.0%). Manufacturing declined by 19,000 jobs (-2.1%).

Nationally, professional and business services grew fastest and added the most jobs (3.6% or 686,000 jobs) over the 12 months ending in July. Leisure and hospitality (3.0%); transportation, warehousing and utilities (up 2.9%); and education and health services (2.8%) also grew at faster-than-average rates. No industry lost jobs. In contrast to Austin and Texas, manufacturing grew by 1.2%.

The net gain for private service-providing industries in Austin is 30,600 jobs, or 4.8%, over the last 12 months. Employment in goods producing industries is unchanged. Statewide, private service-providing industries are up 280,900 or 3.6% but goods producing industries are down 12,500 jobs or -0.7%.

We also now have July labor force, employment, and unemployment numbers for Texas and local areas in Texas. The same data for all U.S. metros that we often do a ranking of will not be released until, September 1. In June, Austin had the lowest rateof unemployment among the 50 largest metros.

Unemployment numbers for July show Austin’s performance relative to the state and other major Texas metros being sustained. In July, Austin is at 3.5%, while the other major metros range from 3.9% in San Antonio to 4.7% in Houston. Dallas and Fort Worth are at 4.1% and 4.3% respectively. Austin’s rate one year ago was 4.5%. The rates in Texas’ other major metros are 0.7 (Houston) to 1.3 (Dallas) percentage points improved on the rates seen a year ago. The statewide not-seasonally-adjusted rate is now 4.6%, compared to 5.5% in July of last year. The July national rate is 5.6% compared to 6.5% in July of last year.

In 2007, before the impact of the Great Recession, unemployment averaged 3.6% in Austin, 4.3% in Texas, and 4.6% nationally. Based on average rates for the first seven months of 2015, unemployment is lower in Austin (3.3%) than before the recession. Texas’ unemployment is the same as it averaged in 2007, while the nation, with unemployment averaging 5.6%, still has ground to make up.

Within the Austin MSA, Travis County has the lowest unemployment rate in July, at 3.3%, while Caldwell County has the highest at 4.5%. The rate is 3.5% in Williamson County, 3.6% in Hays County, and 4.3% in Bastrop County.

On a seasonally adjusted basis, Austin’s July unemployment rate is 3.2%, up from 3.1% in June. Austin has not seen unemployment this low since January 2001, before the “dot-com” recession. The statewide rate is 4.2%, unchanged from June. The last time Texas’ rate was as low as 4.2% was mid-2007. Nationally, the seasonally adjusted unemployment rate is 5.3% in both June and July. The national rate has yet to fall to the level it averaged (4.6%) through 2006 and 2007 before the impact of the Great Recession.

San Antonio has the next lowest seasonally adjusted rate at 3.5%, while Dallas, Fort Worth, and Houston are at 3.7%, 3.9% and 4.2% respectively. July rates are up from June in Austin and Houston (by 0.1) and unchanged in the other major metros. Seasonally adjusted unemployment rates for Texas metros are produced by theFederal 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 declined. In July 2014, Austin’s number of unemployed was 47,837, and has decreased by 11,355 or 23.7%, to 36,482. Unemployment averaged more than 60,000 for three years running during the Great Recession.

The Austin metro’s civilian labor force (employed plus unemployed) is essentially unchanged (down 102 or 0.0%) from one year age, while persons employed increased by 11,253 or 1.1%. Texas saw positive growth in employed (0.3%) while labor force declined by 0.7%, and 130,951 fewer people (18.0%) are unemployed. Nationally, July civilian labor force is up by 0.6%, while employed is above the level of a year ago by 1.7%, and nearly 1.5 million fewer people (14.6%) are unemployed.

Texas Workforce Commission will release August estimates on September 18.

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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.

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Beverly Kerr

Vice President of Research, Beverly Kerr, joined the Chamber’s Economic Development Department in 2004, following 10 years in a similar role with the Kansas City Area Development Council. Beverly earned an M.A. in economics at the University of Missouri-Kansas City.