Texas jobless rate starts to climb again
The Texas unemployment rate soared in September, climbing for the first time since April as job growth downshifted sharply.
Unemployment rose to 8.3 percent, up more than a percentage point from 7 percent in August, the Texas Workforce Commission reported Friday. Nationally, unemployment averaged 7.9 percent in September.
The pace of job growth, meanwhile, fell by more than half over the month. Employers added about 41,000 jobs, down from about 112,000 in August.
The weaker employment report reflects a slowdown nationally as federal stimulus programs authorized by the CARES Act expire, and Congress and the Trump administration remain unable to reach agreement on another round of relief spending. Meanwhile, the TexasWorkforce Commission said thisweek that it will reinstate work search requirements for those receiving unemployment benefits.
Ray Perryman, CEO of the Perryman Group, an economic consulting firm in Waco, said the slowdown is not unexpected given the initial surge in job gains when businesses reopened after coronavirus shutdowns were lifted in May. But, he added, further delays on a stimulus package aswell as barriers toworkers getting unemployment relief could derail the recovery.
“The CARES Act, while certainly not perfect, helped to keep the basic structure of the economy together during the worst of the pandemic,” Perryman said. “Unfortunately, it was implicitly based on the presumption that the dislocations
would only require assistance for two to three months.”
The Houston unemployment rate also surged in September, soaring to 9.6 percent from 7.6 percent in September, according to the Federal Reserve Bank of Dallas. Houston gained about 24,000 jobs last month, but the total number of payroll jobs in the region, just under 3million, are still down about 5 percent from a year ago, according to government data.
Most of the local gainswere attributed to the reopening of schools, not broader economic improvement, said Patrick Jankowski, the lead economist at the Greater Houston Partnership, a business-financed economic development group. Employers who able to retain workers through the federal small business loan program, the Paycheck Protection Program, are laying off workers as the money runs out, he said.
“The stimulus package that was passed in spring is exhausted and it’s showing up in the data,” Jankowski said.
Key sectors in the region continue to struggle. Employment in manufacturing and construction have fallen 10 percent over the year. Oil and gas employment is down more than 11 percent.
Keith R. Phillips, senior economist at the Dallas Fed, said he expects the state to continue to add jobs through the rest of the year even as the pace slows. But that forecast, he added, will depend on the path of the coronavirus.
“Another surge (of COVID) in the fourth quarter would dampen that outlook,” Phillips said. “It’s not that people are reading about it in the newspaper and are getting scared. They see more families and friends have it, and they get concerned and become careful aboutwhat they do.”