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Report: 'Improving outlook' for Texas economy after Arctic Blast

Posted at 9:27 PM, May 06, 2021
and last updated 2021-05-06 22:27:19-04

DALLAS — A new report from the Federal Reserve Bank of Dallas shows the effects of February's Arctic Blast aren't enough to slow down aggressive momentum in the Texas economy.

"Employment in Texas expanded at an annualized 11.3 percent," said Anil Kumar, economic policy adviser and senior economist at the Dallas Federal Reserve. "It was significantly strong than the U.S., which was at eight percent in March, and other recent data indicates we will see continued momentum for growth going forward."

Kumar authored the report and said three reasons are driving the state's rebound — substantial federal stimulus, greater mobility and the COVID-19 vaccine.

The Small Business Administration said Wednesday its Paycheck Protection Program is out of cash, but Kumar said Texas business owners have nothing to fear. There is still plenty of funding available.

"Even after the Paycheck Protection Program stimulus winds down, there is still significant fiscal stimulus out there," Kumar said. "Through unemployment and jobless benefits and also the stimulus checks that were sent earlier to households."

The Texas energy sector is one of the largest industries in the country, and the report found it recently gained traction even with the uncertainty of the pandemic.

"We've seen recent improvements," Kumar said. "As oil prices have crept up, we have seen Texas rig count rise modestly, and we see the sector has added jobs every month since September."

Kumar said the oil and gas industry isn't the only part of the Texas economy on the mend – the leisure and hospitality sector has made great strides recently.

"You see this economic activity bouncing back," Kumar said. "You should see a very sharp rebound in the leisure and hospitality sector as restrictions decline and mobility increases."

March also marked the end to statewide masking orders in Texas. The report found decreased restrictions on capacity limits and greater mobility, combined with the COVID-19 vaccine, helped Texans get back to work.

"Vaccines are absolutely important for continued momentum in growth," Kumar said about worker shortages despite high unemployment numbers. "Vaccinations can go a long way in reducing the fear of the virus."