Insights
- Austin is the 4th best performing among the top 50 metros, adding 36,500 jobs, 2.8% growth, in the year ending in February.
- The fastest job growth over the last 12 months occurred in Austin’s other services (7.1%) and construction and natural resources (5.3%) industries.
- Austin’s seasonally adjusted unemployment rate is 3.5% in February, up from 3.4% January.
Nonfarm payroll jobs
Austin’s February nonfarm payroll jobs total is up by 36,500, or 2.8%, over the last 12 months 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 11,400 or 0.8% from January to February.
Austin’s year-over-year increase of 2.8% makes it the 4th best performing among the 50 largest metro areas. San Antonio (2.6%), Houston (2.4%), and Fort Worth (2.1%) also rank in the top 10. Dallas (1.7%) ranks 18th.
March is the month in which benchmark revisions are applied to previously published labor market estimates. Statewide, job creation in 2023 was revised downward from 2.9% to 2.5%, but in Austin job growth was faster in 2023 than preliminary estimates indicated. Instead of creating 32,800 jobs (2.5%), revisions indicate that Austin created 41,800 jobs (3.2%) in 2023.
For the year ending in February, private sector job growth in the Austin MSA is 2.7%, or 30,400 jobs, with gains across 10 of the 11 major private industry sectors. Total job growth was 2.8% as the government sector, which accounts for 15% of metro area employment, grew by a robust 3.2%.
Texas saw net private sector job growth of 2.0% with 10 of the 11 private industry groups adding jobs over the last 12 months. Total job growth was higher, at 2.2%, due to strong (3.4%) growth in the government sector. For the nation, private sector job growth was 1.6% for the 12 months ending in February with all but two private industries adding jobs. Overall job growth was slightly higher at 1.8%, due to relatively robust 2.8% government sector growth.
Jobs in February are up by 16,300 or 1.2% from January in the not-seasonally-adjusted series for Austin. The seasonally adjusted series also shows positive job growth with a gain of 11,400 jobs or 0.8%. Seasonally adjusted jobs are also up in Dallas (0.3%), Fort Worth (0.2%), Houston (0.2%), and San Antonio (0.1%). Statewide, seasonally adjusted jobs are up by 49,800 or 0.4%. Nationally, seasonally adjusted jobs are up from January by 275,000 or 0.2%.
In Austin, all but one of the 11 major private industry sectors added jobs over the last 12 months. Other services is the fastest growing (7.1% or 3,500 jobs) and education and health services (4.9% or 7,400) added the most jobs. Construction and natural resources was also fast growing (5.3% or 4,300). Information saw negative year-over-year growth (-6.0% or -3,300).
Statewide, the private industries with the most significant growth are other services (5.1%) and education and health services (3.7%). Information jobs declined by 1.8%.
Nationally, leisure and hospitality (2.8%) and construction and natural resources (2.7%) were the leading private sector growth industries over the last 12 months. Information (-1.1%) and transportation, warehousing and utilities (-0.9%) lost jobs.
Over the last 12 months, the net gain for private service-providing industries in Austin is 25,100 jobs, or 2.6%. Employment in goods-producing industries is up by 5,300 jobs or 3.5%. Statewide, private service-providing industries are up 190,400 or 2.0%, and goods-producing industries are up 41,600 or 2.1%.
Additional graphs: New/lost jobs by industry for Jan. 2024-Feb. 2024 and the trend since 2000 for six large industries and six small industries.
Labor force, employment & unemployment
We also now have February 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 April 3. In January, Austin had the 22nd lowest rate of unemployment among the 50 largest metros. Despite that middle-of-the-pack ranking, data for February show Austin sustains its superior performance relative to the state and the other major Texas metros.
In February, Austin’s not-seasonally-adjusted unemployment rate is 3.7%, which is an increase of 0.2 percentage points above where it was one year ago (3.5%). Rates in the other major Texas metros range from 4.1% in Dallas and San Antonio to 4.6% in Houston. Houston and San Antonio are unchanged, and Dallas and Fort Worth’s rates are, respectively, 0.1 and 0.2 percentage points higher than last year. The statewide rate is now 4.4%, unchanged from February of last year. The national unemployment rate is 4.2%, up from 3.9% a year ago.
February unemployment rates are 3.6% in Travis County, 3.7% in Bastrop and Hays Counties, and 3.9% in Caldwell and Williamson Counties.
On a seasonally adjusted basis, Austin’s February unemployment rate is 3.5%, up from 3.4% in January, the statewide rate is unchanged at 3.9%, and the national rate is 3.9%, up from 3.7%.
Among Texas other major metros, Dallas, Fort Worth and San Antonio 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 up from one year ago, the number unemployed has also risen. In February 2023, Austin’s number of unemployed was 51,076. Over the last 12 months, the unemployed increased by 3,749 or 7.3%, to 54,825. This is due to a larger increase in the labor force, compared to the number employed. The Austin metro’s civilian labor force (employed plus unemployed) increased by 39,110 persons or 2.7% from one year ago, while persons employed increased by 35,361 or 2.5%.
Additional graphs: Labor force & employment: Texas and United States
Texas’ labor force growth (284,007 or 1.9%) over the last 12 months exceeds the growth in the number employed (272,241 or 1.9%). Thus, the number of unemployed increased by 11,766 or 1.8%. Nationally, February civilian labor force is up by 1.1 million or 0.7%, while the number of employed is above the level of a year ago by 602,000 million or 0.4%, and 505,000 more people (7.8%) 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 the year, then 3.3% in the second half of 2023. That slowing continues with YOY growth averaging 2.6% to date in 2024. Nevertheless, Austin achieved stronger growth than all but 3 of the 50 largest metros for the 12 months ending in February.
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, the state YOY job growth to date in 2024 falls farther, averaging 2.1%.
In the Texas Employment Forecast following the release of January numbers, Dallas Fed senior business economist Luis Torres commented that Texas employment growth seems to be returning to its long-term growth rate. The March 8 forecast indicated Texas jobs would increase 2.2% in 2024. However, the updated forecast, released on the 22nd and incorporating February’s jobs performance, and other data, bumped up the Dallas Feds job growth forecast for 2024 to 2.5%. That 2.5% rate is characterized as above the states long-term average.
The Texas Workforce Commission and the U.S. Bureau of Labor Statistics will release March estimates on April 19.
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Until recently, this monthly article on the labor market releases included tracking of the pandemic recovery in Austin. While the fullness of recovery varies from industry to industry, and the unemployment rate remains above 2019’s average, Austin is otherwise securely recovered from the pandemic. Therefore, we are reverting to our customary focus on month-over-month and year-over-year trends. If you would like to review post-pandemic performance, the last article that included observations of this is October 2023. The CES and LAUS spreadsheet files on our Economic Indicators page will continue to include change from the last pre-pandemic month to the current month.
