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Jobs 'Gone to Texas' Once Again on Renewed Optimism in Oil, Natural Gas Patch

A rising rig count and increased oil and gas spending are again spurring Texas employment, with the energy sector leading job growth in the state during May.

The state added 14,800 seasonally adjusted nonfarm jobs in May, led by 6,600 in the "mining and logging sector," i.e. oil and gas, according to the Texas Workforce Commission (TWC). An estimated 235,900 people were working in the oil and gas sector during May from 229,300 in April and 221,800 in May 2016.

According to the Federal Reserve Bank of Dallas (Dallas Fed), U.S. oil and gas employment rose in April by 3,800 jobs to roughly 390,900, with Texas accounting for more than half of the energy sector job growth at 55%.

"Texas oil and gas employment expanded again in April by 3,300 jobs to roughly 214,100 jobs, recording the fifth consecutive monthly increase," according to the Dallas Fed, which covers the Eleventh District. "Oil and gas extraction employment in Texas added 920 jobs to 92,100, while payrolls in support activities for mining rose by 2,380 jobs to 122,000."

The state's Office of Economic Development has revived the use of "Gone to Texas" as part of a plan to attract businesses for its advertising campaign, "Texas. Wide Open For Business." Folklore has it that "Gone to Texas," abbreviated as "GTT," was painted on abandoned homes and fences during the 1800s during the land rush.

Before his death at The Alamo in 1836, Tennessean Davy Crockett said of his final campaign for Congress, "I told the people of my district, that, if they saw fit to re-elect me, I would serve them faithfully as I had done; but, if not, they might all go to hell, and I would go to Texas. I was beaten, gentlemen, and here I am."

Several indicators increased for the state's oil and gas sector during May.

"Both Texas and U.S. oil and gas employment expanded in April, with the increase primarily in support activities," the Dallas Fed said. "Oil production growth in Texas remained strong in May, particularly in the Permian Basin. Growth in the Texas rig count continued to be concentrated in horizontal rigs."

Production in the Permian Basin rose in May by 53,400 b/d to 2.34 million b/d, the Dallas Fed noted. "In the Eagle Ford, production was up by 33,300 b/d to 1.29 million b/d," the fourth consecutive monthly increase since bottoming in January.

Operating rigs numbered 356 in the Permian and 98 in the Eagle Ford as of May. The Dallas Fed also noted that the horizontal rig count in Texas increased to 388 in May from 359 in April, while vertical and directional rig counts in Texas fell to 65 from 67.

The state's annual growth rate reached 2.2% last month, a sharp improvement from 1.8% posted at the end of 2016, according to the TWC. Unemployment fell to 4.4%, inching close to the national rate of 4.1%. Besides oil and gas jobs, Texas also showed strong growth during May in the construction sector, with employment up by 3,400, and financial activities, which added 3,200 jobs.

Houston, the acknowledged U.S. energy capital, saw its annual job growth rate rise 1.5% during May. The city's adjusted unemployment rate was 5.1%, down from 5.9% in February.

The TWC said the Amarillo Metropolitan Statistical Area (MSA), where oil and gas activity is underway, recorded the  lowest unemployment rate during May at 3.1%. The Midland MSA, in the heart of the Permian Basin, registered a rate of 3.4%. The Austin-Round Rock, College Station-Bryan and Lubbock MSAs had rates of 3.2 percent.

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