May 18, 2016

Economy Burns Bright in the Lone Star State

In spite of a small flicker of doubt during the month of March, brought on by a weak global economy and complicated by lower oil prices and a strong US dollar, The Lone Star State continues to outshine other states within the US, economic indicators confirm. While some individual states within the nation and the US as a whole are beginning to see the glimmer of a resurging economy, the State of Texas continues to outstrip the performance of other states, leaving no doubt that the most recent recession is behind us at last


In something of a horse race between the US and Texas ongoing since the recession, both Texas and the US began to see economic growth beginning in 2010. By calendar year 2014, Texas’ real gross domestic product grew by 5.2 percent, compared with 2.39 percent for the U.S.

Texas’ unemployment has been at or below the National rate for 110 consecutive months. While the US Consumer Confidence level hovers at around 96.2, it is down 5.1 percent from where it was at the end of March 2015. Texas’ Consumer Confidence is ranked at 99.1 percent in March 2016, still significantly above that of the US, in spite of the uncertainty around oil prices. As usual, the Great State of Texas continues to win the bragging rights.

Since May of 2015, Texas jobs continue to rise in most of Texas’ major industries, including business and professional services, trade, transportation, utilities, education, leisure and hospitality, and health services industries. Construction, with the upward trending housing sales as bellwether, also demonstrated modestly continuing growth within the region since March, reflecting optimism on the whole.

Texas’ housing growth does remain slow however; housing sales in March increased 8.5 percent year-over-year on a seasonally-adjusted basis. While the inventory of houses for sale within the state is dwindling, residential building permits issued during the 12 months ending February 2016, were a total of 67,647; reflecting 1.7 percent increase over the previous year, according to Glenn Hegar, the Texas Comptroller of Public Accounts.

The Texas Leading Index came under the gun of a decline in oil well permits and has been in a decline from its peak in August 2014, but began to edge upward in March 2016. The Index, which foreshadows future trends in the business cycle, has been impacted in a positive way thanks to recent moderate increases in oil prices, the upticks in Texas-based corporations’ stock prices, and what has been a noticeable dip in State unemployment figures. Since March, the Index continues in its positive course helping to create an optimistic investment atmosphere here.