Unemployment in Texas rose sharply in September and rose for the first time since April, when job growth fell sharply.
Unemployment rose to 8.3 percent, up more than one 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 during the month. Employers added approx. 41,000 jobs, down from approx. 112,000 in August.
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The weaker employment report reflects a downturn nationally as federal stimulus programs approved by the CARES law expire and Congress and the Trump administration remain unable to agree on another round of emergency spending. Meanwhile, the Texas Workforce Commission said this week that it will reintroduce job search requirements for those receiving unemployment benefits.
Ray Perryman, CEO of Perryman Group, a financial consulting firm in Waco, said the slowdown is not unexpected given the initial rise in job gains as companies reopened after the coronavirus shutdown in May. But he added further delays on one stimulus package as well as barriers for workers receiving unemployment relief can track recovery.
“While the CARES law was certainly not perfect, it helped keep the basic structure of the economy together during the worst of the pandemic,”
Houston unemployment also rose in September, rising to 9.6 percent from 7.6 percent in September, according to the Federal Reserve Bank of Dallas. Houston got about 24,000 jobs last month, but the total number of paid jobs in the region, nearly 3 million, has still fallen about 5 percent from a year ago, according to government data.
Most of the local gains were attributed to the reopening of schools, not broader economic improvement, said Patrick Jankowski, the lead economist at the Greater Houston Partnership, a business-funded economic development group. Employers who are able to retain workers through the federal program for small businesses, the Paycheck Protection Program, lay off workers when money runs out, he said.
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“The stimulus package that was passed in the spring has been exhausted and it is shown in the data, ”said Jankowski.
Key sectors in the region continue to struggle. Employment in production and construction has fallen 10 percent during the year. Oil and gas employment has fallen more than 11 percent.
Keith R. Phillips, senior economist at the Dallas Fed, said he expects the state to continue adding jobs throughout the rest of the year, even as the pace slows. But this prognosis, he added, will depend on the pathway to coronavirus.
“Another increase (by COVID) in the fourth quarter would dampen the outlook,” Phillips said. “It’s not that people read about it in the newspaper and get scared. They see that more families and friends are having it and they get worried and become cautious about what they are doing. ”