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.

Economists: Texas economy to pick up in 2017, but modestly


The Texas economy and labor market should grow a little sunnier this year, but a few of the dark clouds that gathered in the past two years will linger into 2017, according to economists at the Federal Reserve Bank of Dallas.

Texas employers should expand payrolls by 2 percent this year, about 242,000 jobs, senior economist Keith Phillips said this week in San Antonio. While far lower than the state’s long-run average, which typically exceeds national job growth rates, the job gains in 2017 are expected to surpass the estimated 1.6 percent annual growth rate through November of last year.

“We think the worst is behind us, but there’s a lot of uncertainty out there,” said Mine Yücel, the Dallas Fed’s director of research.

Yücel reiterated Phillips’ 2017 job growth forecast Wednesday during a business forecast breakfast hosted by the University of Texas McCombs School of Business.

Despite the sharp drop in oil prices that sent the energy industry into a tailspin over the past two years, Yücel said, Texas did not drop into a recession at any point. And the modest recovery in commodity prices has helped stem the bleeding of oilfield services jobs and helped buoy statewide manufacturing outlooks, she said.

Yet the same factors that dragged on the state economy in 2015 and 2016 continue to weigh on growth at the start of the new year.

While rig counts and production levels have started to recover, energy prices remain below levels that typically spur new well drilling. Meanwhile, the strong U.S. dollar and economic weakness among some of the state’s primary trading partners are hampering Texas exporters, Yücel said.

Texas still fared better than most energy states, Philips said earlier in the week. And the Interstate 35 corridor, particularly Dallas and Austin, remained an exception to the otherwise modest growth in Texas, he said.

“Job growth picked up in the second half of 2016 due to a stabilization of the energy sector,” he said. “With that positive momentum, the Texas economy enters 2017 poised to shift into ‘second gear.’”

Dallas led the second-half rebound, the Fed economists noted, adding roughly 73,000 jobs through November.

Job growth in Austin, however, softened during the second half of the year despite a solid gain for 2016 as a whole.

“One reason is Austin is at full employment,” Yücel said, noting the metro area’s 3 percent unemployment rate. “It’s harder to grow when you’re at full employment.”



Reader Comments ...


Next Up in Business

Have a great workplace? Let us know
Have a great workplace? Let us know

Help us spread the word about the best places to work in Austin. Nominations are now open for the American-Statesman’s 2017 Top Workplaces of Greater Austin project. The project recognizes employers that stand for the best in leadership, vision, an employee-centered culture and other qualities. Any employer is eligible — private company...
Up the Ladder

Biomedical Aeglea BioTherapeutics has named Anthony Quinn interim chief medical officer. Health care St. David’s HealthCare has named Diana Kraus assistant vice president of trauma. Professional honors Sandra D. Gonzalez of Greenberg Traurig has been elected to the Fellows of the Texas Bar Foundation.
Top Local Business Stories of the Week
Top Local Business Stories of the Week

WHOLE FOODS TAKEOVER? Report says Albertsons considering takeover bid for Whole Foods: Supermarket chain Albertsons is exploring a possible takeover of Austin-based Whole Foods Market, the Financial Times reported last week, citing unnamed sources. Albertsons, which operates about 2,200 stores, is controlled by buyout group Cerberus Capital Management...
House tax plan has surprising implications

Last June, Republicans in the House Ways and Means Committee rolled out their “Better Way” tax reform plan. It proposes big changes to business and personal taxation. Critics say it’s regressive and will likely decrease revenues because of the cut in personal rates. But a closer look suggests neither is true. Moreover, the business...
Business Digest: Germany-based group buys Austin office building

COMMERCIAL REAL ESTATE Germany-based group buys Austin office building The Capital Ridge office building in Southwest Austin has a new owner. GLL Real Estate Partners, a real estate fund management group based in Munich, Germany, recently purchased the building from Capital Ridge-RE LP, according to Travis County deed records. The purchase price was...
More Stories