Job Growth & Unemployment, July 23, 2024
Beverly Kerr, Vice President, Research
Insights
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- Austin is the 21st best performing among the top 50 metros, adding 22,500 jobs, or 1.7% growth, in the year ending in June.
- The fastest job growth over the last 12 months occurred in Austin’s construction and natural resources (4.7%) and other services (4.2%) industries.
- Two industries lost jobs over the last 12 months: information (-4.2%) and professional and business services (-0.7%)
- Austin’s seasonally adjusted unemployment rate is 3.4% in June, unchanged from the preceding three months.
Nonfarm payroll jobs
Austin’s year-over-year job growth slowed to 1.7%, or 22,500 jobs, in June according to Friday’s releases of monthly labor market data by the Texas Workforce Commission and the U.S. Bureau of Labor Statistics. On a seasonally adjusted basis, Austin jobs increased by 1,100 or 0.1% from May to June.
Austin’s year-over-year increase of 1.7% makes it the 21st best performing among the 50 largest metros. Among Texas’ major metros, only Houston (2.3%) ranks in the top 10. Job growth is 2.6% for the top 10 fastest growing metro areas in aggregate. San Antonio (2.0%), Fort Worth (1.9%) and Dallas (1.4%) rank 13th, 18th and 25th respectively. Six of the 50 largest metros saw negative job growth over the last 12 months.
For the year ending in June, private sector job growth in the Austin MSA is 1.4%, or 16,500 jobs, with gains across nine of the 11 major private industry sectors. Total job growth was higher at 1.7% as the government sector, which accounts for 15% of metro area employment, grew by a robust 3.1%.
Texas saw net private sector job growth of 1.8% with 10 of the 11 private industry groups adding jobs over the last 12 months. Total job growth was higher, at 2.0%, due to strong (3.2%) growth in the government sector. For the nation, private sector job growth was 1.5% for the 12 months ending in June with all but one private industry adding jobs. Overall job growth was slightly higher at 1.6%, due to relatively robust 2.6% government sector growth.
Jobs in June are up by 4,900 jobs or 0.4% from May in the not-seasonally-adjusted series for Austin. The seasonally adjusted series also shows positive job growth with a gain of 1,100 jobs or 0.1%. Seasonally adjusted job growth is also positive in Fort Worth (0.1%), but essentially unchanged in Houston and San Antonio, and negative in Dallas (-0.3%). Statewide, seasonally adjusted jobs are essentially unchanged (down by 1,200 or 0.0%). Nationally, seasonally adjusted jobs are up from May by 206,000 or 0.1%.
In Austin, all but two of the 11 major private industry sectors added jobs over the last 12 months. Construction and natural resources is the fastest growing (4.7% or 3,900 jobs) and education and health services added the most jobs (5,900 or 3.8%). Other services was also fast growing (4.2% or 2,200). The two industries with negative year-over-year growth were information (-4.2% or -2,200) and professional and business services (-0.7% or -1,900).
Even compared to other major tech markets, the growth of professional and business services in Austin during the pandemic was extraordinary—about 14% in both 2021 and 2022, compared to about 6% annually in the preceding decade. Although employment in the industry in Austin has been basically flat since the beginning of 2023, it stands at a higher level than it would have been had the pandemic not occurred and growth held at about 6% annually in that industry. See additional graphs comparing the trend in Austin’s information and professional and business services industries to three other tech-intensive metros.
Statewide, the private industries with the most significant growth are other services (3.7%) and education and health services (2.9%). Information jobs declined by 0.1%.
Nationally, education and health services (4.2%) and construction and natural resources (2.5%) were the leading private sector growth industries over the last 12 months. Information (-1.0%) lost jobs.
Over the last 12 months, the net gain for private service-providing industries in Austin is 12,400 jobs, or 1.3%. Employment in goods-producing industries is up by 4,100 jobs or 2.6%. Statewide, private service-providing industries are up 163,100 or 1.6%, and goods-producing industries are up 46,900 or 2.3%.
Additional graphs: New/lost jobs by industry for May 2024-June 2024 and the trend since 2000 for six large industries and six small industries.
Labor force, employment & unemployment
We also now have June labor force, employment, and unemployment numbers for Texas and local areas in Texas. The same data for all U.S. metros will not be released by the U.S. Bureau of Labor Statistics until July 30. In May, Austin had the 16th lowest rate of unemployment among the 50 largest metros. Data for June show Austin sustains its superior performance relative to the state and the other major Texas metros.
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In June, Austin’s not-seasonally-adjusted unemployment rate is 3.8%, up from 3.5% a year ago. Rates in the other major Texas metros range from 4.2% in San Antonio to 4.8% in Houston. Dallas and Fort Worth are at 4.3%. Each of the other major metros are 0.4 percentage points higher than last year. The statewide rate is now 4.5%, up from 4.2% in June of last year. The national unemployment rate is 4.3%, up from 3.8% a year ago.
June unemployment rates are 3.7% in Travis County, 3.8% in Hays County, 3.9% in Williamson County, 4.1% in Bastrop County, and 4.3% in Caldwell County.
On a seasonally adjusted basis, Austin’s June unemployment rate is 3.4%, unchanged from the preceding three months. The statewide rate is 4.0%, unchanged from April and May. The national rate is 4.1%, up from 4.0% in May.
Among Texas’ other major metros, San Antonio is at 3.8%, Dallas and Fort Worth are at 3.9%, and Houston is at 4.4%. Seasonally adjusted unemployment rates for Texas metros are produced by the Federal Reserve Bank of Dallas. (The Texas Workforce Commission also produces seasonally adjusted rates for Texas metros, but publication lags the Dallas Fed’s estimates.)
With Austin’s unemployment rate ticking up from one year ago, the number unemployed has also increased. In June 2023, Austin’s number of unemployed was 50,496. Over the last 12 months, the unemployed increased by 5,647 or 11.2%, to 56,143. This is due to a smaller increase in the number employed, compared to the labor force. The Austin metro’s civilian labor force (employed plus unemployed) increased by 33,438 persons or 2.3% from one year ago, while persons employed increased by 27,791 or 2.0%.
Additional graphs – Labor force & employment: Texas and United States
Texas’ labor force growth (368,723 or 2.4%) over the last 12 months exceeds the growth in the number employed (295,807 or 2.0%). Thus, the number of unemployed increased by 72,916 or 11.6%. Nationally, June’s labor force is up by 1.1 million or 0.7%, while the number employed is above the level of a year ago by 215,000 or 0.1%, and 882,000 more people (13.9%) are unemployed.
Conclusion
Recent months have seen Austin’s and Texas’ job growth slow. Austin’s year-over-year (YOY) job growth averaged 5.7% in the first half of 2023, then 3.3% in the second half. That slowing continues in the first half of 2024 with YOY growth averaging 2.2%. For June, YOY growth is 1.7%—which ranks Austin 21st and in the middle of the pack among the top 50 metros. Between the Great Recession and the pandemic, Austin’s annual average growth ranged from 3.4% to 4.7% and averaged 4.0%.
For Texas, growth averaged 4.1% in the first six months of 2023, followed by an average of 2.6% for the last six months of the year. As in Austin, average YOY job growth in the first half of 2024 falls farther, averaging 2.1%. Texas’ YOY growth for June is 2.0%.
Last month, the Dallas Fed’s Texas Employment Forecast was relatively strong, estimating that statewide jobs will increase 2.4% in 2024. This month, the forecast for 2024 has been revised down to 1.9%. In addition to job growth through June, the forecast is based on projected national GDP, oil futures prices, and the Texas and U.S. leading indexes. Slower employment growth, combined with decreases in the Texas and U.S. leading indexes lowered the forecast.
The Texas Workforce Commission and the U.S. Bureau of Labor Statistics will release July estimates on August 16.
