Texas Economy 2011: A Slow Recovery

The Texas economy, as fast as it has been able to thrive and triumph,  it has, at times, also faced rapid and exhaustive crashes. Updated 2 months ago

The Texas economy added 253,200 jobs in fiscal 2011 even though the year began and ended with a month of mild job losses. Energy-based industries charged ahead from the nation's worst recession since the Second World War, while a few industries remain mired in fading growth momentum or experienced job losses.

Texas had, by the end of 2011, recovered 406,000 of the 433,400 jobs lost during the recession. Texas accounted for 19 percent of the nation's jobs added in 2011. The total jobs added was more than any other state, and this fact contributed to an influx of people to Texas.

The state population increased by 227,500 in fiscal 2011. With that influx, the labor force grew more quickly than the supply of jobs, so the unemployment rate closed the year higher (at 8.5 percent) than it began (at 8.2 percent).

The Consumer Confidence Index, a monthly measure of the level of optimism consumers have in the economy, did not gather momentum in 2011, staying well below its baseline level and closing the years were in began. The index for the West South Central states, which includes Texas and three other states, began the year in September at 68, improved to levels above 80 in the late fall and winter of 2010, then dropped and closed at 72 in August.

Sales tax collections declined during the recession by 2.7 percent in fiscal 2009 and by a further 6.6 percent in fiscal 2010. Collections rebounded by a strong 9.4 percent in fiscal 2011, but much of the growth was related to oil and natural gas exploration and production activity.

Consumer spending appears to be playing a more limited role in the economic recovery, unlike previous recessions. Motor vehicle sales, however, were quite robust in fiscal 2011, as those sales ta collections increased by 12.7 percent, a reflection of the backlog of demand following a 23 percent drop in 2009 and a 2 percent increase in 2010.

Of the eleven major industries of the Texas economy, all except Information and Government experienced net job growth. Gaining industries included Mining and Logging, Construction, Manufacturing, Trade/Transportation/Utilities, Financial Activities, Professional and Business Services, Education and Health Services, Leisure and Hospitality, and Other Services.

Job growth in the goods-producing industries was 5.2 percent over the last years, markedly exceeding a 1.9 percent growth rate among the service-providing industries, owing largely to the strength of oil and natural gas drilling and energy-related machinery and drilling rig manufacturing.

Government, due to the loss of temporary 2010 Census staff, postal service layoffs, and school-related cutbacks lost 1 percent of its jobs during the year. The industry that added the most jobs was trade, transportation, and utilities, at 49,600, followed by professional and business services, at 49,100.

With growth spurred by demands from the energy industry, the value of manufacturing increased in 2011, from $156.9 billion in 2010 to an estimated $169.1 billion, according to the U.S. Bureau of Economic Analysis and the state Comptroller's estimates of gross domestic product.

Texas' service-providing industries, which account for more than 84 percent of the state's total nonfarm employment, underperformed in job-rate growth, but sill accounted for 67 percent of the added jobs.

The information industry remained in the doldrums in 2011, contracting by a further 7,700 jobs in 2011. The sector includes old and new technologies, such as printing, publishing, cellular telephone providers, Internet providers and software services.

Source: Excerpted from the State of Texas Annual Cash Report 2011, Comptroller of Public Accounts.

 

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