Texas job growth likely to slow in late 2023

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After two years of post-pandemic recovery, job growth in Texas will begin to slow in the final months of the year, Roberto Coronado, senior vice president and senior economist at the Dallas Fed, said in the Texas Tribune. Tuesday's event.

Coronado said the Dallas Fed had projected statewide job growth of 3% this year, but expects growth to fall to about 2% in the final quarter of 2023, lower than Texas' trend level. He said the growth rate is close to 2.1%.

Texas led the nation in job growth over the past year, even though the unemployment rate remained at 4.1%, higher than the national average of 3.8%, according to a Department of Labor statistical report released last week. The state recorded more than 400,000 new jobs from August 2022 to August 2023.

Coronado pointed to the migration of domestic people and businesses to the state as a major factor in the job growth. He noted that the number of people moving to Texas began to accelerate during and after the pandemic, and that approximately 82% of people born in Texas still lived in Texas in 2021.

“Why are companies coming? What we're hearing from them is that the cost of doing business is very low and it's very company-friendly,” Coronado said. “So moving to Texas and raising a family here is attractive to businesses and families alike.”

The diversity of Texas' economy, from the tech hub of Austin to the energy operations of Corpus Christi, is also driving the state's economic growth, Coronado added. But he said signs of change may be on the horizon as rapidly changing technology and artificial intelligence continue to impact the job market.

By 2030, two-thirds of jobs in Texas will require some kind of postsecondary education, and about half of Texans currently have that level of education, he said. Meanwhile, Coronado said about a third of high-wage, high-demand jobs will not require a bachelor's degree by 2028, and most of these jobs will be concentrated in technical fields such as manufacturing and construction. He said he is doing so.

Community colleges will play an important role in preparing states for this change, he added.

“The best model we have seen so far is when community colleges have strong partnerships with the local business community,” Coronado said. [this] Will the university community start producing the talent they need? ”

Coronado said the Dallas Fed held off on raising interest rates at last week's meeting, but is focused on bringing inflation down to 2% in the near term. Generally speaking, raising interest rates lowers the inflation rate.

Coronado said demand has exceeded supply across the economy for the past two and a half years. As inflation accelerates, the prices of goods and services are rising both nationally and in Texas.

“What does that mean for the average Texan? That means they're allocating more to their monthly budget to make ends meet. That's putting pressure on households and businesses because prices are soaring.” “It means we're putting a lot of effort into it,” Coronado said. “We think we need to rein in inflation.”

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