Despite Two Years of Job Growth, Texas Unemployment Inches Up

Texas may have reached a milestone in July, reporting two straight years of job growth. But the unemployment rate inched up again last month, from 7 percent to 7.2 percent, while economic growth remained relatively consistent. 

The Dallas Federal Reserve reported at the beginning of August that decelerated growth in the southwest region can be attributed to global and national economic uncertainty. Though job growth has continued throughout 2012, it slowed from 3.2 percent in the first quarter of the year to 1.4 percent in the second.

The Texas unemployment rate is still lower than the national average, which was 8.3 percent in July, according to the U.S. Bureau of Labor Statistics. Housing demand also increased the number of available construction jobs in Texas in June and July. And Texas' 4.4 percent foreclosure rate remains lower than the national foreclosure rate of 7.4 percent, according to the Dallas Fed.

“Over the last two years, the Texas economy has added 457,700 total nonfarm jobs," Texas Workforce Commission Chairman Andres Alcantar said in a press release. He emphasized that the Texas economy has shown “consistent growth across a variety of industries.” Click on the bars of the graph below to see seasonally adjusted job growth by industry in Texas in July.

The education and health sector added the most jobs in July — 12,600 — and currently has a 3.2 percent annual growth rate. Manufacturing led growth among the production industries, adding 4,200 jobs. Midland and Odessa, where oil and natural gas drilling continues to boom, still have the lowest unemployment rates in the state at 4.2 percent and 4.9 percent respectively. In contrast, the unemployment rates in McAllen, Brownsville and Beaumont are 12.3 percent, 11.6 percent and 11.4 percent respectively.

The government sector, which includes local, state and federal government workers, grew by 8,700 jobs in July, according to the TWC's seasonally adjusted estimates. But raw numbers, which don't account for seasonal economic variations, show government employment actually dropped by 33,600 jobs, mostly at the local level, from June to July. That's a decline of 62,400 jobs from July 2011 to July 2012.

State agencies reported 6,000 fewer jobs at the end of May than the previous year, according to the State Auditor’s Office, which released its third-quarter state employment numbers on Thursday. The largest state agency, the Texas Department of Criminal Justice, has seen its employment numbers shrink the most (as this Tribune interactive shows) in response to deep budget cuts in the 82nd legislative session. As the Tribune reported on Tuesday, TDCJ staff say the reduced staffing has created a less safe environment at some units and increased overtime demands.

The state's health agencies have also taken a large hit since last year. The Department of Aging and Disabilities dropped 956 jobs, the Department of State Health Services dropped 388 jobs and the Department of Family and Protective Services lost 320 workers, according to the SAO report.

“It’s no secret that Texas’ sustained growth over the last two years has come from the strength of our private sector, which has grown by 258,500 jobs over the past year,” Commissioner Tom Pauken said in the Workforce Commission press release. “Private sector employment in Texas has grown by 3.0 percent over the past year, compared to just 1.8 percent growth nationally.”