Texas Jobs Market May Be Signaling Decent News for the Oil Patch

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If you just read the headlines, you would think everything is great for the jobs market in Texas. The Texas Workforce Commission reported on Friday that the state added some 13,700 nonfarm jobs in October. This now creates a tally of job growth in 18 of the past 19 months.

Another point made in the report was that the state’s seasonally adjusted unemployment rate fell to 4.7% in October. This was down slightly from 4.8% in September, and it remains under the national unemployment rate of 4.9%.

Of the 13,700 total jobs, some 13,300 were tied to the private sector. The report for the trade, transportation and utilities industries recorded the largest private industry employment gain over the month, adding 8,200 jobs. Financial activities were up for the seventh consecutive month, adding 4,400 jobs in October.

When it comes to Texas, most of us still think about the oil jobs. After all, oil jobs can be worth two-times to three-times other jobs for the full pay and economic spending impact. The report’s Mining and Logging sector is where these oil jobs reside, and there was some decent news if you compare October to September. Just don’t look for good news in October of 2016 versus October 2015. Total mining and logging jobs were 224,100 last month, up 1,000 from September but down 31,800 from October a year ago.

Manufacturing employment added 2,000 jobs in October. Construction jobs actually ticked lower as well in October. This was at 692,600, versus the 695,800 for September, but it is actually up marginally from the 690,300 a year earlier. Where this gets hard to discern is how many of those construction and manufacturing jobs are tied directly to or are marginally attached to the oil and gas sector. Ditto for “other service” and in Trade, Transport and Utilities category.

Elsewhere, changes seen month over month were as follows (October versus September):

  • Information 200,900 (-800)
  • Professional and Business Services 1,627,000 (-1,500)
  • Education and Health Services 1,660,900 (+2,800)
  • Leisure and Hospitality 1,310,900 (-700)
  • Other Services 429,900 (+1,100)
  • Manufacturing 845,700 (+2,000)

This is not bad news on the surface. It may also be far short of great news.