CNN/Money 
graphic
News > Economy
graphic
Blame Texas for weak job market?
Fed study says the Lone Star state usually creates jobs after recessions; this time, it hasn't.
September 16, 2003: 11:34 AM EDT
By Mark Gongloff, CNN/Money Staff Writer

NEW YORK (CNN/Money) - Plenty of scapegoats are available to blame for the economy's prolonged job-market slump, rightly or wrongly -- including China and India, as well as Democrats and Republicans -- but there's a new potential target: Texas.

That's right. President Bush's home state provides about 7 percent of the nation's jobs and is typically a job-growth engine during and after most recessions -- but it's not pulling its weight in the unusually slow recovery from the 2001 recession, according to a study published Tuesday on the Dallas Federal Reserve's Web site.

"In past recessions, the state propped up U.S. recoveries with above-average employment growth," Dallas Fed economist Fiona Sagalla wrote. "This time, Texas' job market remains too weak to do much for the nation."

The key to Texas' performance in prior recessions was oil. Higher oil prices helped fuel nine of the 10 recessions after World War II, raising costs for businesses and consumers, but providing a boon to the oil industry, and to the job market in the Lone Star state.

While oil prices rose during and after the latest recession, they never soared as high as they did in prior downturns, so Texas oil producers have had relatively little incentive to boost production and hire more workers.

What's more, the importance of Texas tea (oil, that is) to the broader Texas economy diminished in the 1990s, being replaced by the very high-tech industries that have been hit hard by the latest downturn.

"During the recession, Texas manufacturers of computers and communications equipment lost all of the jobs gained in the '90s expansion," Sagalla noted.

Instead of blame, in fact, Texas likely deserves sympathy. Though the national rate of job growth has been abysmal in recent years, Texas' has actually been worse.

While the national unemployment rate was 6.2 percent in July, the jobless rate was 6.6 percent in Texas. Some major population centers, such as Dallas (at 7.4 percent) and Houston (7.2 percent), struggled with even worse rates.  Top of page




  More on NEWS
JPMorgan dramatically slashes Tesla's stock price forecast
Greece is finally done with its epic bailout binge
Europe is preparing another crackdown on Big Tech
  TODAY'S TOP STORIES
7 things to know before the bell
SoftBank and Toyota want driverless cars to change the world
Aston Martin falls 5% in its London IPO




graphic graphic

Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.

Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.