You have reached your limit of free articles this month.

Enjoy unlimited access to myStatesman.com

Starting at just 99¢ for 8 weeks.

GREAT REASONS TO SUBSCRIBE TODAY!

  • IN-DEPTH REPORTING
  • INTERACTIVE STORYTELLING
  • NEW TOPICS & COVERAGE
  • ePAPER
X

You have read of premium articles.

Get unlimited access to all of our breaking news, in-depth coverage and bonus content- exclusively for subscribers. Starting at just 99¢ for 8 weeks

X

Welcome to myStatesman.com

This subscriber-only site gives you exclusive access to breaking news, in-depth coverage, exclusive interactives and bonus content.

You can read free articles of your choice a month that are only available on myStatesman.com.

Dallas Fed: Oil recovery adds momentum to region’s growing economy


The energy sector’s continued stabilization, an increase in retail sales and solid demand across a wide spectrum of industries boosted regional economic activity in recent weeks, according to a report Wednesday from the Federal Reserve Bank of Dallas.

In its chapter of the Beige Book, an anecdotal survey of the economy compiled every six weeks by the Federal Reserve banks, the Dallas Fed said the economic activity in its district “expanded moderately … with a slight acceleration from the prior reporting period.”

The Dallas Fed’s district includes all of Texas and parts of New Mexico and Louisiana. Texas accounts for more than 95 percent of the region’s economic activity.

The recovery of the energy sector and industries closely linked to it added a little extra fuel to the region’s ongoing economic growth. Oil and gas activity “surged,” the report said, noting that the Eagle Ford has joined the pickup already seen in the Permian Basin.

While exploration and production companies noted some layoffs, hiring by oilfield services firms “picked up notably in the first quarter,” the report said.

Several contacts expected the sector’s accelerating pace will moderate as the year progresses and still sounded hints of caution, outlooks were more positive than the prior reporting period.

The same held true for regional businesses overall, as most of the Dallas Fed’s contacts said they expect 2017 to be stronger than 2016.

That showed in staffing patterns, with hiring gains across most sectors of the economy — including a gain in manufacturing employment in 2017 after net losses the prior two years. Staffing firms said demand was stronger this year than the same time in 2016.

The expansion of manufacturing activity picked up over the past six weeks, including a rebound at fabricated metal factories, many of which supply oil and gas firms. However, exports “remained a source of weakness” and several factory managers noted concerns about policy uncertainties, particularly around trade with Mexico.

While previous Dallas Fed reports have noted the negative impact of border issues on Texas retailers, as well, retail sales rose slightly faster than the prior six weeks, the report said. However, overall outlooks among retailers in the region dimmed to a more neutral tone.

In contrast, outlooks among construction and real estate firms remained optimistic, thanks in part to a strong start to the spring home-selling season. Buyers were more price sensitive and affordability remained a concern in many parts of the district.

Rent activity was mixed, however. Rent growth was strong in Dallas-Fort Worth, moderated in Austin and remained soft in Houston.

The service sector continued growing at a solid pace. Professional and technical services firms noted particularly strong gains, and the leisure and hospitality sector had a good March after losses earlier in the year.

Financial services contacts said loan demand rose, although they saw a lower volume of consumer loans. Outlooks were optimistic, with expectations of stronger demand and business activity six months from now.

And in agriculture, contacts noted good moisture levels and crop conditions. Cotton acreage is expected to increase sharply this year, thanks to expectations for higher prices. Rising prices for cattle were helping ranchers as well.



Reader Comments ...


Next Up in Business

Up the Ladder

Banking & finance Chase has named Marcus Kline vice president and Austin-area manager of business banking. Community The Greater Austin Hispanic Chamber of Commerce has named Luis Rodriguez president and chief executive officer. Manufacturing & retail Factory Mattress has named Sarah Johnson chief financial officer. Technology Umbel has named Mike...
Have a great workplace? Let us know

Help us spread the word about the best places to work in Austin. Nominations remain open for the American-Statesman’s 2017 Top Workplaces of Greater Austin project, with the nomination deadline extended until July 7. The project recognizes employers that stand for the best in leadership, vision, an employee-centered culture and other qualities...
If Social Security overpays you, you’re still on the hook

Suppose Social Security makes a mistake in determining your benefits. Guess what? Their mistake becomes your mistake, and they will bill you for any amount they overpaid you, even if they told you the benefits in question were yours to collect. This happened to the husband of a woman who I’ll call Dana to protect her identity. Let me call her...
‘Jenga tower’ starting to make mark on Austin’s skyline
‘Jenga tower’ starting to make mark on Austin’s skyline

This week, some Austinites might have noticed a change on the downtown skyline. Construction has progressed to the point that the Independent — nicknamed the “Jenga tower” — has started taking on elements of its defining look as the 58-story condominium project rises toward its place as the city’s tallest building...
Report: Walmart won’t make rival bid for Whole Foods
Report: Walmart won’t make rival bid for Whole Foods

A week after Amazon unveiled plans to acquire Austin-based Whole Foods Market in a deal valued at $13.7 billion, Walmart has decided it won’t put in a rival bid, according to published reports. The Bentonville, Ark.-based retail giant is one of several companies that had reportedly been looking at trying to match or beat Amazon’s $42-per-share...
More Stories