6/23/2020
1
Texas Economic Performance and
Outlook Amidst COVID-19 Pandemic
Federal Reserve Bank of Dallas
6/26/2020
Keith R. Phillips
DISCLAIMER: The views expressed are the authors’ and do not necessarily reflect the views of the Federal Reserve Bank of Dallas or Federal Reserve System.
Texas in the Pandemic
2
1
2
6/23/2020
2
Most states see some recovery in May – TX stronger than average
3
-2
-1
0
1
2
3
4
5
6
7
DC HI
ND
MN
WY
VA
NM
NE
CA
SD IA DE IL
MD
NY
OR
OK
NC
CT
AR
KS
KY
LA
U.S
.
GA
MO
MA
NH
TX
WV
AL
AK
FL
AZ
NJ
ME
OH
CO
UT
NV
MS
WA
WI
IN RI
TN
SC ID PA
MT
MI
VT
TexasU.S.
Percent change, May/April 2020, SA
SOURCES: Bureau of Labor Statistics.
Rebound broad-based across most sectors
4
1.9 1.5
-2.7
0.71.9
14.4
2.00.4
7.1
3.3
-5.3
2.71.2
-2.3
1.3
3.5
25.8
0.9 0.42.0
3.6
-5.1
-10
-5
0
5
10
15
20
25
30
Total Trade,Transp.& Util.
(20.0%)
Gov't(15.9%)
Prof. &Bus. Serv.
(14.4%)
Educ. &HealthServ.
(13.9%)
Leisure& Hosp.(9.0%)
Mfg.(7.3%)
Fin.Activ.(6.7%)
Constr.(6.2%)
Info. &Other Svcs
(4.9%)
Oil & Gas,Mining Sup.
(1.6%)
U.S. Texas
Job growth (percent)
NOTE: Data show May 2020/April 2020 non-annualized growth. Numbers in parenthesis indicate share of total state employment for May.SOURCES: Bureau of Labor Statistics; Texas Workforce Commission; FRB Dallas.
3
4
6/23/2020
3
Texas Job Losses in Pandemic Less than Nation – but revisions
may change this
5
-25
-20
-15
-10
-5
0
MI
VT
NV
NY HI
NJ
RI
MA
PA
DE
CT
NH
KY
ME
OH
WI
WA
CA
AK
U.S
.
MD IN LA
OR
NC
SC
WV
MT IL
MN FL
TN
CO
NM
MO IA
GA
TX ID VA
MS
AL
ND
KS
AZ
SD
AR
UT
WY
NE
OK
DC
Texas
U.S.
Percent change, Apr 2020/Feb 2020, SA
SOURCES: Bureau of Labor Statistics.
Texas job losses less severe than U.S. in most industries
6
-14.5-12.0
-4.3
-10.6 -11.3 -10.7
-49.1
-3.2
-13.9
-18.6
-9.8-10.1
-6.6
-1.5
-7.4-9.5
-4.9
-39.7
-1.6
-8.1
-14.4-11.8
-60
-50
-40
-30
-20
-10
0
Total Trade,Transp.& Util.
(20.3%)
Gov't(16.7%)
Prof. &Bus. Serv.
(14.6%)
Educ. &HealthServ.
(13.8%)
Mfg.(7.4%)
Leisure& Hosp.(7.3%)
Fin.Activ.(6.9%)
Constr.(6.3%)
Info. &Other Svcs
(4.9%)
Oil & Gas,Mining Sup.
(1.7%)
U.S. Texas
Job growth (percent)
NOTE: Data show April 2020/Feb. 2020 non-annualized growth. Numbers in parenthesis indicate share of total state employment for April.SOURCES: Bureau of Labor Statistics; Texas Workforce Commission; FRB Dallas.
5
6
6/23/2020
4
Texas unemployment rate spikes; slightly below nation’s
7
13.3
13.0
0
2
4
6
8
10
12
14
16
'00 '02 '04 '06 '08 '10 '12 '14 '16 '18 '20
Percent, SA
NOTES: Data through May 2020. Grey bars show U.S. recessions.
SOURCES: Bureau of Labor Statistics; Texas Workforce Commission; adjustments by the Dallas Fed.
U.S.
Texas
8
Texas Business Outlook indexes show services,
manufacturing activity falling more slowly in May
-28.1
-28.0
12.4
9.2
-80
-60
-40
-20
0
20
40
60
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Revenue (TSSOS)
NOTES: Data through May 2020. Dashed lines are post-recession averages.
SOURCE: Federal Reserve Bank of Dallas Texas Business Outlook Surveys (TBOS).
Diffusion index, SA
Production (TMOS)
7
8
6/23/2020
5
TX Mobility & Engagement Continues to Rise, COVID-19 Grows
9
-50
-110
-100
-90
-80
-70
-60
-50
-40
-30
-20
-10
0
1
2
4
8
16
32
64
128
256
512
1024
2048
4096
3/1 3/8 3/15 3/22 3/29 4/5 4/12 4/19 4/26 5/3 5/10 5/17 5/24 5/31 6/7 6/14
COVID19 daily new cases
COVID19 daily deaths
Mobility and engagement
Num. of hourly employees working
NOTE: Mobility and engagement index data up to June 13, 2020, all other data up to June 19. Mobility and engagement index values are scaled such that the national index average over
January-Febuary are subtracted out and divided by the national value in the week ending in April 11, the lowest national weekly value. Mobility and engagement index value can be
interpreted as mobility and engagement relative to the national trough in mobility and engagement.
SOURCES: Homebase, Johns Hopkins University, SafeGraph, Federal Reserve Bank of Dallas.
Count, 7 day avg. Index, 7 day avg.
2923
29
-21
TX Mobility & Engagement and COVID-19
- 52 (4/10)
5/1: Phase 1
of re-opening
5/22: Phase
2 of re-
opening
-107 (4/10)
6/3: Phase 3
of re-opening
6/12:
Restaurants
expand to
75% capacity
Texas restaurant reservations weakening over past week
-100
-80
-60
-40
-20
0
20
Feb Mar Apr May June
Texas
Houston
San Antonio
Austin
Dallas
U.S.
NOTE: Data through June 18, 2020. Data refers to year/year percent change in seated diners at restaurants on the OpenTable network across all channels: online
reservations, phone reservations, and walk-ins.
SOURCE: OpenTable.
Percent change, y/y, 7 day moving average
-100
-90
-80
-70
-60
-50
5/16 5/18 5/20 5/22 5/24 5/26 5/28 5/30 6/1 6/3 6/5 6/7 6/9 6/11 6/13 6/15 6/17
9
10
6/23/2020
6
San Antonio
11
San Antonio has fewer workers who can work from home
2837
4842
40
2350
3347
5727
5727
4234
3739
0 10 20 30 40 50 60 70
Other areas in TexasSan Antonio
AustinDallas/Fort Worth
Houston
HispanicAsianBlackWhite
Income>=$60,000Income<$60,000
With college degreeNo college degree
FemaleMale
TexasU.S.
Percent of Workers Compatible with Remote Working
Fractions of Workers Who Can Work Remotely
NOTE: All samples, except for the top bar are restricted to workers in Texas.
SOURCES: IPUMS, author's calculations. Federal Reserve Bank of Dallas
11
12
6/23/2020
7
San Antonio Likely to be More Impacted than State and Nation
• 12.8% of jobs in San Antonio MSA are in the leisure and hospitality sector
• 10.9% in Texas,11.0% in U.S.
• 54.8% in San Antonio MSA with high school or lower education
• 41.1% in Texas, 38.8% in U.S.
• While Initial claims have increased less in San Antonio, digital divide is greater here and thus more likely that
unemployed have had to call TWC to file a claim
• Of the 3.5 million calls the TWC received on Tuesday 4/7, 3.1 million calls were met with a busy signal
• Phone line backlogs continue
• Data so far suggests San Antonio not hit as hard – this is supported by mobility data - maybe because outbreak
and deaths not as bad here as in other places
• But revisions likely to be significant
San Antonio jobs decline less than other metros-data subject to revision
-8.2-8.9
-10.0
-8.0
-10.0
-15.0
-10.0
-5.0
0.0
DFW(29.4%)
Houston(24.3%)
Austin(8.5%)
San Antonio(8.4%)
El Paso(2.5%)
May/Feb 2020
NOTES: Data refer May 2020/Feb 2020 non-annualized growth. Numbers in parentheses refer to share of state employment in May 2020.SOURCES: Bureau of Labor Statistics; Texas Workforce Commission; seasonal and other adjustments by FRB Dallas.
Percent change, SA
13
14
6/23/2020
8
Job loss broad-based across industries – although tourism hit hardest
-8.0
-2.7
-2.4
-9.8
-6.4
-28.2
-1.8
-0.4
-3.2
-14.2
-6.2
-12.4
Total nonfarm employment
Trade, transp. & utilities (17.9%)
Government (16.9%)
Health & educ. services (15.4%)
Prof. & business svcs (13.4%)
Leisure & hospitality (10.2%)
Financial activities (9.2%)
Construction (5.8%)
Manufacturing (5.1%)
Other services (3.4%)
Information (1.9%)
Mining (0.9%)
February–May 2020
NOTE: Data show seasonally adjusted and annualized percentage employment growth by sector. Numbers in parentheses represent the share of total employment and may not sum
to 100 due to rounding.
SOURCE: Bureau of Labor Statistics; Texas Workforce Commission; adjustments by the Dallas Fed.
Percent Change, SA
T
Unemployment rate in San Antonio Below State and Nation
13.3
13.0
11.8
0
2
4
6
8
10
12
14
16
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
U.S.
Texas
San Antonio
Percent*
NOTE: Data up to May 2020.
SOURCE: Bureau of Labor Statistics.
15
16
6/23/2020
9
Total initial claims below state average
17.6
15.0
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
20.0
3/7 3/14 3/21 3/28 4/4 4/11 4/18 4/25 5/2 5/9 5/16 5/23 5/30 6/6
Texas Bexar County
NOTE: Weekly initial claims data are through the week ending June 6, 2020. Labor force data are as of March 2020.
SOURCE: Bureau of Labor Statistics.
Percent
COVID cases and hospitalizations on the rise – deaths likely to follow
0
1
2
3
4
5
6
7
8
9
10
0
50
100
150
200
250
300
350
400
4/8 4/15 4/22 4/29 5/6 5/13 5/20 5/27 6/3 6/10 6/17 6/24 7/1 7/8
Daily COVID19 Fatalities (7dma)Daily COVID19 Patients in Hospitals (7dma)
San Antonio Hospitalizations Rising Sharply - Deaths May Soon Follow(7dma)
San Antonio Trauma Service Area Daily Hospitalizations Bexar County Daily Fatalities (7dma)
Hospitalizations shifted forward 14 days
17
18
6/23/2020
10
Mobility declined less in San Antonio than state
-120
-100
-80
-60
-40
-20
0
20
1/4 1/18 2/1 2/15 2/29 3/14 3/28 4/11 4/25 5/9 5/23 6/6 6/20
San Antonio MSA
Texas
Index
NOTE: Mobility and engagement index data up to June 13, 2020.
SOURCE: Federal Reserve Bank of Dallas.
Outlook for 2020
20
19
20
6/23/2020
11
Texas and U.S. Leading Indexes plummet, recover slightly
21
107.78
80.22
75
80
85
90
95
100
105
95
100
105
110
115
120
125
2014 2015 2016 2017 2018 2019 2020
NOTES: Data through May 2020. Oil-bust shading represents Texas energy-sector employment peak to trough, December 2014 to November 2016. Latest Texas value is
estimated.
SOURCE: Dallas Fed.
Index, 2014 = 100, SAOil bust
Texas
U.S.
Index, 2014 = 100, SA
Texas employment expected to rebound in second half but
end the year below 2019 levels
22
-70.8
37.9
52.3
-80.0
-60.0
-40.0
-20.0
0.0
20.0
40.0
60.0
Jul-19 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20 Jul-20 Aug-20 Sep-20 Oct-20 Nov-20 Dec-20
Texas Payroll Employment Growth Estimate
NOTE: Forecast scenario estimates Texas payroll employment for May based on initial claims data and the remainder of the year based on US GDP growth of -34.4% Q2, +19.6% Q3, and +13.1% Q4, as well as direct COVID-19 impacts from March, April, and July and WTI prices following the futures contract curve as of 6/19.
Percent, SAAR
-3.2-10.0
-5.0
0.0
5.0Percent, Y/Y
21
22
6/23/2020
12
Texas unemployment rate expected to slowly decline
23
13.513.0
8.9
2
4
6
8
10
12
14
16
Jul-19 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20 Jul-20 Aug-20 Sep-20 Oct-20 Nov-20 Dec-20
Texas Unemployment Rate Estimate
NOTE: Forecast scenario estimates Texas payroll employment for May based on initial claims data and the remainder of the year based on US GDP growth of -34.4% Q2, +19.6% Q3, and +13.1% Q4, as well as direct COVID-19 impacts from March, April, and July and WTI prices following the futures contract curve as of 6/19. Unemployment rate forecast assumes a labor force participation rate of 63.8 and a payroll/household employment ratio of 0.96 at year-end.
Percent, SA
▪ Pandemic is unprecedented and has many aspects of a natural
disaster instead of a typical recession
▪ Economic activity is slowly recovering; path of the virus and consumer
and business responses highly uncertain
▪ Most economists expect a sharp decline in Q2 and recovery in the
second half – but still expect to end the year down significantly
▪ Texas likely to be close to national average despite prolonged
weakness in the energy sector
▪ Large tourism sector, smaller share of workers tha can work from
home suggested San Antonio would be hit harder – but lower infection
rate may have offset these negative factors – so far
Summary
23
24
6/23/2020
13
Thank you!Please visit dallasfed.org for more information
25
Dallas Fed Publications
26
Dallas Fed Economics
Texas Economic Indicators
Texas Business Outlook Surveys
Southwest Economy
Special Reports
www.dallasfed.org
25
26
Top Related