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.

Texas service-sector activity accelerates, but concerns persist


A jump in retail sales helped boost the pace of Texas service-sector growth in March, but political uncertainties and sluggish demand in some parts of the state left managers with less optimistic business outlooks, according to a monthly report from the Federal Reserve Bank of Dallas.

The state revenue index, a key measure of activity among private, service-providing firms in Texas, nudged up to a reading of 15.2 in March from 14.1 the prior month, according to the Texas Service Sector Outlook Survey, which was released Tuesday. The greater, positive figure indicated that the sector’s expansion — now on an 88-month growth streak — accelerated slightly this month.

Some of that faster pace came from retailers across Texas. The state sales index, which measures retail activity, increased to 10.3 in March from 6.9 in February, according to the Texas Retail Outlook Survey, a subset of the broader survey.

The boost in retail sales prompted stores to increase hiring during the month, although a measure of hours worked suggested that workweeks contracted, the retail survey noted.

Hiring accelerated across the entire service sector, too. While retail payrolls have gone up and down in recent months, the sector as a whole has increased or maintained payrolls each month for more than seven years, according to the survey’s employment index.

Private service-providing companies account for about two-thirds of the state’s non-farm jobs, according to the Texas Workforce Commission. The same companies account for about 60 percent of the state’s economic output, according to the Dallas Fed.

Despite solid demand in March, managers reported less optimism in their current and future business outlooks. Measures of both company-specific and general business expectations dropped for retailers and the full sector, the reports noted.

In fact, outlooks for current, company-specific activity among retailers dropped sharply and returned to negative figures after four consecutive months of solidly optimistic reports.

Those outlooks appeared to reflect the economic and political uncertainties that managers expressed in a set of anonymous comments compiled in the reports. Demand and business growth were mixed across different industries, and at times across different firms in the same industry — the latter likely reflecting the disparate impact of the energy sector’s slowdown on different parts of the state.

More consistent were the hopes and concerns about the federal regulatory and political environment. Several managers expressed their optimism that a Republican Congress and White House would ease regulations on businesses.

A smaller number expressed concerns about the potential border tax and immigration restrictions proposed by President Donald Trump, as well as the Muslim travel ban. One firm noted a slowdown in U.S. travel due to the orders, saying “a wider message has been sent to global businesses and travelers that the U.S. is becoming increasingly more difficult to work with.”

Yet most of the concerns centered on longstanding issues, such as the state of the Texas oil and gas industry and political unknowns.

“With so much uncertainty about this current administration and what they are actually about, I feel this is beginning to have a negative impact on customers’ outlooks,” said one manager in the accommodations industry. “I don’t even know what to believe these days regarding what is coming out of Washington.”



Reader Comments ...


Next Up in Business

Driven by SXSW, Austin alcohol sales jump 10% in March
Driven by SXSW, Austin alcohol sales jump 10% in March

Austin alcohol sales jumped 10 percent in March, according to an American-Statesman analysis of state data. Thanks in large part to South by Southwest, March is typically the most lucrative month of the year for many venues – especially those in downtown Austin. That was especially true this year, with tabs at the city’s bars, restaurants...
Central Texas home starts hit highest level in a decade
Central Texas home starts hit highest level in a decade

With no letup in housing demand, Central Texas builders kept up their swift pace in the first quarter, starting construction on homes at the fastest rate in a decade, according to new figures. Austin-area builders started work on 3,487 homes in the first quarter, a 1.3 percent increase over the same period last year, according to Metrostudy, which...
Business Digest: Pollo Tropical closes all Austin, Dallas locations

RESTAURANTS Pollo Tropical closes all Austin, Dallas locations Pollo Tropical has closed 30 restaurants nationwide, including all of its locations in the Austin area. The chicken chain said Monday that it is also pulling out of the Dallas/Fort Worth and Nashville, Tenn., markets. There were three locations in Central Texas: • 211 S. Lamar Blvd...
Delta adding nonstop flights between Austin and Boston
Delta adding nonstop flights between Austin and Boston

Austin’s airport is getting nonstop flights to yet another destination. This time around, Delta Air Lines is adding service from Austin-Bergstrom International Airport to Boston. The new flights kick off Sept. 11. Delta says service will be six days a week using newly upgraded Airbus A319 jets with free onboard entertainment offerings for all...
Advocates push for hearings on stalled medical marijuana bills
Advocates push for hearings on stalled medical marijuana bills

Dr. Robert S. Marks says he routinely faces a dilemma when cancer patients and others dealing with chronic pain broach the topic of marijuana as a treatment option. “You’re in a very tough position between what the law tells you to do, and what your (medical) oath tells you to do,” said Marks, who operates two pain management clinics...
More Stories