‘Firing on all cylinders’: Texas adds nearly 78,000 jobs in February as jobless rate dips


Texas added 77,800 nonfarm jobs in February, and the state’s unemployment rate ticked down again as COVID-19 cases declined and the economic expansion continued to gain momentum.

The Texas economy got a strong lift from rising oil and gas prices as the fallout from the Russian invasion of Ukraine spread.

Texas added 4,500 jobs in mining and logging, a gain of 2.3% in February. For the past year, mining and logging jobs grew over 13%, double the rate of the total Texas labor market, according to the Texas Workforce Commission.

There was widespread strength in the job market last month with notable growth in both the goods-producing sector and services. Texas also added 40,000 to the civilian workforce, which is important to filling thousands of open jobs in the state. And Texas’ unemployment rate was 4.7%, down 0.1 percentage points from January.

“It looks like the labor market in Texas is firing on all cylinders,” said Pia Orrenius, a senior economist at the Federal Reserve Bank of Dallas. “We have healthy job growth and good labor force growth, and the unemployment rate is falling. What’s not to like?”

February’s monthly job gains were the most since October and November, before the omicron variant swept through the state and sent hospitalizations soaring. January’s job gains were also revised upward from 29,000 to over 50,000, suggesting that the Texas economy weathered the omicron wave better than expected.

“The economy seems to be growing more resilient to COVID,” Orrenius said.

Texas surpassed its pre-pandemic peak for employment in November, topping 13 million nonfarm employees, and it recorded nearly 13.2 million workers last month. It’s now in expansion mode with jobs growing 0.6% in February, faster than U.S. job growth for the month.

The U.S. unemployment rate, 3.8% in February, remains lower than Texas’ jobless rate, and has been lower for many months. Texas’ higher unemployment rate may actually be an advantage for a state that’s adding jobs at a rapid clip, especially with wages on the rise.

“There’s a little bit of slack out there, and maybe we can rope those workers back into the labor force,” Orrenius said.

Texas still had 675,000 workers unemployed in February, almost 200,000 more than before the pandemic. And the major goods-producing sectors — mining and logging, construction and manufacturing — all remain below pre-pandemic job levels.

The hard-hit leisure and hospitality industry also has fewer workers than before the pandemic.

But all of these sectors have been rallying. Leisure and hospitality added 17,400 jobs last month. Manufacturing added 6,300 jobs, and construction added 5,900.

On the services side, over 18,000 jobs were added in trade, transportation and utilities, a giant sector with over 2.6 million employees. Professional and business services gained 16,800 positions, and financial activities added 10,100 jobs.

The segment that includes health care added 7,200 positions.

The surge in mining and logging jobs, up 2.3%, was among the strongest gains in the industry in almost a decade, said Bruce Bullock, director of the Maguire Energy Institute at Southern Methodist University.

“This is a really good sign for the oil and gas business,” Bullock said. “The biggest challenge has been finding trained people — and getting them to come back to work.”

The Russian invasion, followed by sanctions on its oil and gas production, has roiled energy markets. Higher prices for gasoline, heating and electricity are a burden for many consumers, but they provide a tailwind for the Texas economy.

On Friday, the Dallas Fed raised its growth outlook for Texas by about 1 percentage point for the first half of the year. Citing recent increases in energy prices, it now projects that Texas will add 440,200 jobs in 2022.

The war and its fallout remain a major economic threat to the state, nation and world. They’ve also added more problems for supply chains, which were already slowing global production and pushing up prices.

If there were fewer supply chain restraints, Bullock said, “the number of new jobs would be significantly higher.”

The government sector was among the few to lose workers last month with a decline of 6,900 positions. One explanation is that private employers are winning the bidding wars for talent.

“In these tight labor markets, government is really at a disadvantage because they’re not as flexible on wages,” Orrenius said. “They can’t ramp up pay as fast as the private sector.”

Among Texas metros, Austin had the lowest unemployment rate in February, at 3.3%, not seasonally adjusted. The rate in Dallas-Plano-Irving was 4%, and it was 4.2% in Fort Worth-Arlington, according to the workforce commission.

McAllen had an unemployment rate of 8.4% in February, and Beaumont’s rate was 8%.



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