Retail leads August growth in jobs

The Houston area gained 5,300 jobs in August, as industries hit hard at the beginning of the pandemic continue to see slow job growth, according to data released Friday by the U.S. Department of Labor.

The retail sector reversed a trend that saw it shed 13,900 jobs in Houston from March through May. The sector has been on a steady upward trend since, adding 3,400 jobs in August. Businesses that had to completely shut down during the beginning of the pandemic, such as barbershops and salons, saw 4,500 jobs added last month.

The figures are an improvement from July, when Houston employers cut 2,700 jobs and COVID-19 cases began to rise. As cases start to drop and businesses acclimate to operating during a pandemic, people are starting to feel more comfortable going out, said Parker Harvey, principal economist for Workforce Solutions, which provides employment services in the 13-county region.

“Part of it is simply that things are starting to normalize,” he said.

Other sectors didn’t fare as well. Health care and social assistance firms lost jobs for the first time since April, shedding 5,300 jobs. Construction lost 1,600 jobs.

The region’s unemployment rate still remains high at 8.1 per

cent, about double last year’s 4.1 percent level.

However, there is likely to be job growth next month in most of the state as businesses such as restaurants, retail stores, libraries and gyms will be able to increase their capacity to 75 percent from 50 percent.

Reopening does bring the risk of an increase in COVID-19 cases, but Harvey said he doesn’t anticipate another shutdown.

“I don’t think the appetite for that level of shutdown is there,” he said. “We may have to pause or pull back, but I don’t see us going back to full shutdown.”

Eventually there will be diminishing returns on progress, he said. Some businesses had to close permanently due to the pandemic, and Harvey said he anticipated residual unemployment from those closures.

There was also job growth statewide as about 107,000 non-farm jobs were added to the Texas economy.

The state’s unemployment rate fell to 6.8 percent in August from 8 percent the previous month. It was the fourth consecutive monthly decrease and the lowest rate since March.

Texas jobs will continue to recover the rest of the year but not enough to offset the losses in March and April, according to a Dallas Fed report. It projects the number of jobs will decline 4.8 percent this year.

Keith R. Phillips, Dallas Fed assistant vice president and senior economist, said continued progress is dependent on keeping COVID-19 cases low.

“A significant decline in new COVID-19 cases and hospitalizations in Texas since the second half of July is good news for the economic recovery, although a rise in cases in the past week is concerning,” Phillips said.

The seven-day rolling average this week has gone up to about 4,400 cases. A week ago it was about 3,600.

“Currently, we expect job growth to be about 3 percent in the last four months of the year,” Phillips said. “If the recent rise in new cases continues, however, job growth will likely be weaker.”