LOCAL ECONOMIC SNAPSHOT | FED DISTRICTS

As Texas grows, Dallas lags Houston

By BRENDAN CASE Analysis by the Federal Reserve Bank of Dallas shows that Texas and the region are growing
Staff Writer
bcase@dallasnews.com again. The Fed’s Dallas district, which includes Texas and parts of Louisiana and New Mexico,
has grown more quickly since 2000 than other districts. But in a city-by-city comparison,
TROY OXFORD
Staff Artist Dallas lags other cities in the state. Among Texas metro areas, Houston has grown the fastest
toxford@dallasnews.com since 2000.

Employment by Fed district

Since 2000, employment has grown more quickly in the Federal Reserve’s Dallas district than in any of the 11 other Fed
districts, according to an index compiled by the Dallas Fed. The Chicago and Cleveland districts have seen the largest
employment contractions.
January 2000=100

120
Dallas district
U.S.
110 Other Fed districts

100

90

80
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Texas Leading Index Texas Business-Cycle Index Metro Business-Cycle Indexes

The Texas Leading Index, which is The Texas Business-Cycle Index helps The Dallas Fed compiles indexes
designed to shed light on the state gauge the current condition of the designed to reflect economic conditions
economy’s future, has been mostly state economy. During the recent in Texas metro areas. In the last 10 years,
increasing in the last two years after recession, the index bottomed out in Houston has seen the largest
plummeting in the recession. In the second half of 2009. While the improvement in its economy, while
February, the index hit its highest level index currently stands at its highest Dallas has been an underperformer.
since August 2008 — the month level in two years, it remains well
Houston-Sugar Land-
before Wall Street investment bank below its peak in mid-2008.
Baytown
Lehman Brothers failed.
Fort Worth-Arlington
Index level Index level Index level
(Jan. 2000=100) San Antonio
(1987=100) (1987=100)
Austin-Round Rock
150
150 200 Dallas-Plano-Irving
140
190
135 130

120
180
120 110

170 100

105 90
160
80

90 150 70
’00 ’05 ’11 ’00 ’05 ’11 ’00 ’05 ’11

SOURCE: Federal Reserve Bank of Dallas

The bottom line

“We are forecasting 3 percent “During the recent recession, the “North Texas took a big hit during the
employment growth for the Texas business-cycle movements were similar recession, as nearly all its industries
economy this year — about 312,000 across metro areas, peaking around got caught in the downturn. While the
new jobs. High oil prices are a mid-2008 and hitting a bottom in the unemployment rate remains high,
headwind for the national economy, but second half of 2009. The expansion has Dallas Fed indexes show
still benefit the state economy, on net. been moderate, with growth in the that the area has been
The current uptick in Houston economy coming back. Among
the Texas Leading increasing at a big cities
Index, which has somewhat faster pace nationwide,
been a fairly reliable due to energy sector Dallas-Fort Worth
indicator of future strength. Dallas is still and Houston rank
job growth, implies suffering from the hit among the leaders
robust near-term to its financial in percentage job
employment industry.” growth over the last
growth.” 12 months.”

Mine Yücel, senior economist, Jesús Cañas, associate economist, Brendan Case, staff writer,
Federal Reserve Bank of Dallas Federal Reserve Bank of Dallas The Dallas Morning News