- Austin added 22,200 net new jobs, growth of 2.1%, in the 12 months ending in August, making Austin the 15th fastest growing major metro.
- Wholesale trade grew by 6.7% (2,200 jobs), making it Austin’s fastest growing industry, while professional and business services added the most jobs, 7,800 (or 4.1%), over the last 12 months.
- Austin's seasonally adjusted unemployment rate is 2.7%, unchanged from July.
The Austin metropolitan area added 22,200 net new jobs, or 2.1%, in the 12 months ending in August, 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 2.1% growth makes it the 15th best performing among the 50 largest metro areas. Dallas and Houston, gaining 3.8% and 2.7% respectively, made the top ten. San Antonio and Fort Worth, gaining 2.1% and 1.5% respectively, ranked 14th and 29th. (See a SIDEBAR at the bottom 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 August, private sector growth in the Austin MSA is 2.4%, or 21,800 jobs, with all private industry divisions, but one, adding jobs. Austin's sizable government sector (17% of jobs) grew by only 400 jobs or 0.2%, thus bringing the overall growth rate to 2.1%.
Texas saw net private sector job growth of 2.7% with all private industries, but one, adding jobs over the last 12 months. Total job growth was 2.3% 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 1.5% for the 12 months ending in August with all private industries, but one, adding jobs. Overall job growth is a more modest 1.4% because of minor (0.6%) government sector growth.
Jobs in August are essentially unchanged (up by 100) from July in the not-seasonally-adjusted series for Austin. In the seasonally adjusted series, growth is positive, up by 2,900 jobs or 0.3%. Seasonally adjusted jobs are up by 0.5% in San Antonio, 0.3% in Dallas, 0.2% in Houston, and down 0.1% in Fort Worth. Statewide, seasonally adjusted jobs are up 18,200 or 0.1%. Nationally, seasonally adjusted jobs are up from July by 0.1%.
In Austin, professional and business services added the most jobs, 7,800 (4.1%), over the last 12 months. The fastest growing industry was wholesale trade which grew by 6.7% or 3,400 jobs. Also growing at faster-than-average rates are information (3.6% or 1,200); leisure and hospitality (3.3% or 4,400); and transportation, warehousing and utilities (3.2% or 700). Education and health services jobs fell by 2,000 or 1.6%.
Statewide, construction and natural resources grew fastest, by 5.9%, and added the most jobs, 50,000, over the last 12 months. Other relatively fast growing industries included wholesale trade (4.2%); other services (4.0%); transportation, warehousing and utilities (3.7%); and financial activities (3.5%). Information jobs fell by 1.5%.
Nationally, education and health services grew fastest, adding 2.5% over the 12 months ending in August. Construction and natural resources (2.2%); professional and business services (2.1%); and transportation, warehousing, and utilities (1.9%) were also relatively fast growing. Retail trade lost jobs (down 0.6%).
The net gain for private service-providing industries in Austin is 20,100 jobs, or 2.6%, over the last 12 months. Employment in goods producing industries is up by 1,700 jobs or 1.3%. Statewide, private service-providing industries are up 208,500, or 2.4%, and goods producing industries are up 75,600 jobs, or 4.0%.
We also now have August 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 October 2. In July, Austin had the fifth lowest rate of unemployment among the 50 largest metros (San Francisco and Boston had the lowest rates).
Unemployment numbers for August show Austin’s performance relative to the state and other major Texas metros being sustained. In August, Austin is at 2.8%, while the other major metros range from 3.2% in San Antonio to 3.9% in Houston. Dallas and Fort Worth are at 3.3% and 3.4% respectively. Austin’s rate one year ago was 3.1%. The rates in the other major Texas metros are also improved from a year ago. The statewide not-seasonally-adjusted rate is now 3.6%, down from 4.0% in August of last year. The national unemployment rate is 3.8%, improved from 3.9% a year ago.
Within the Austin MSA, Travis County has the lowest unemployment rate in August, at 2.7%, while Caldwell County has the highest at 3.4%. The rate is 2.9% in Williamson and Hays Counties and 3.1% in Bastrop County.
On a seasonally adjusted basis, Austin’s August unemployment rate is 2.7%, the statewide rate is 3.4% and the national rate is 3.7%. Each of these rates are unchanged from July.
Among Texas’ major metros, San Antonio has the next lowest seasonally adjusted rate at 3.1%, while Dallas is at 3.2%, Fort Worth is at 3.3%, and Houston is at 3.7%. Each metro’s rate is unchanged from July, except Houston which improved from 3.8%. 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 August 2018, Austin’s number of unemployed was 36,619. Over the last 12 months, the unemployed declined by 2,946 or 8.0%, to 33,673. 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 19,369 persons or 1.6% from one year ago, while persons employed increased by 22,315 or 1.9%.
Texas’ employment growth (286,336 or 2.2%) also exceeds labor force growth (247,032 or 1.8%). Thus, the number of unemployed decreased by 39,304 or 7.2%. Nationally, August civilian labor force is up by 2.1 million or 1.3%, while employed is above the level of a year ago by 2.3 million or 1.5%, and 167,000 fewer people (2.6%) 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.
As we’ve noted in the last several monthly articles about the CES data, when we see atypical growth rates in Austin’s nonfarm payroll jobs data, we sometimes look at an alternative payroll jobs dataset, the Quarterly Census of Employment and Wages (QCEW) to see how consistent the two datasets appear. QCEW, which is derived from the universe of unemployment insurance-covered employer payroll records, informs the annual benchmark revisions to the sample-survey-based CES data. QCEW data, which is now available through March 2019, gives some evidence that Austin’s recent job growth may be more robust than preliminary CES data indicates.
The Federal Reserve Bank of Dallas produces a version of nonfarm payroll jobs that benchmarks to QCEW data quarterly instead of annually. According to the Dallas Fed’s early-benchmarked and seasonally adjusted data, Austin’s job growth for the year ending in August is 3.2%, 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 2.1%).
The TWC released a new quarter of QCEW data (and revised 2018 data) in August and the current Dallas Fed version of nonfarm payroll jobs has been revised against the new QCEW data.
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 limitations of the sample survey and the potential for actual growth to be higher or lower than preliminary estimates indicate. Many types of investment decisions—residential or commercial construction, for example—are made based on a market’s current job growth performance, so it can be unfortunate to misidentify market conditions.
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, and for other reasons, such as a probable decrease in migration due to similarly low unemployment rates elsewhere, it is reasonable to expect Austin’s job growth to slow, but with the divergence between CES and QCEW data we see in ‘18Q4 and ‘19Q1, there is a basis to question if growth is currently quite as low as 2.1% or 2.2%. Earlier this month, an Austin American-Statesman article, “Dallas Fed: Austin economy continues to boom,” focused on the Dallas Fed’s assessment of Austin indicators, including these jobs numbers.
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