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The Texas economy is poised to have another good year in 2019, supported by higher oil prices and a solid Houston metro area economy.



May 2019 Texas Economic Outlook

May 13, 2019
By Robert A. Dye, Ph.D., Daniel Sanabria

Texas Positioned for Growth in 2019

The Texas economy is poised to have another good year in 2019, supported by higher oil prices and a solid Houston metro area economy. Houston represents about one-fourth of all employment in Texas, and Houston will be a complex story in 2019. The area economy has recovered from the devastating flooding associated with Hurricane Harvey in 2017. Higher oil prices this year will support growth in Houston’s important energy sector. Organic growth for Houston, driven by strong population expansion, is also a significant economic driver for the state. However, even with higher energy prices, Houston faces the unwind of a period of robust expansion in its petrochemical industry. We expect year-over-year job growth in the Houston metro area to remain well above the U.S. average, but it will ease from near 2.5 percent as of March. The Austin metro area will also be an important part of the Texas story in 2019. For much of the past 30 years, Austin has been the fastest growing of the big four Texas metro areas. But through the first quarter of 2019, both Houston and Dallas-Ft. Worth are showing stronger year-over-year job growth than Austin. San Antonio currently trails the group posting 2.0 percent year-over year job growth in March, which is still above the U.S. average of 1.7 percent. The state economy will continue to benefit from the development of Permian Basin oil reserves in West Texas. Development has been hampered by a pipeline bottleneck that will ease this year. The consolidation of Permian Basin production by major oil companies will be a stabilizing force for the state economy.

For a PDF version of this report, click here: May 2019 Texas Economic Outlook

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