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Texas Energy Job Growth Steady, But Harvey’s Impact Still Uncertain

Before Hurricane Harvey pummeled the state and wiped out, at least temporarily, some employment, the Texas economy in August expanded for the 14th consecutive month, adding 5,500 jobs, the Texas Workforce Commission (TWC) said Friday.

The seasonally adjusted unemployment rate fell to 4.2% from 4.3% in July. Annual employment growth was at 2.5% in August, more than double the annual growth rate of 2016.

The latest TWC data did not capture Harvey’s impact because the statistics are compiled from surveys of employers and households in the middle of every month; Harvey made landfall Aug. 25.

According to TWC, the overall mining and logging sector gained more than 1,000 jobs from July, to 243,900 from 242,600. In the oil and gas extraction sub-sector, jobs declined to 91,800 from 92,800, in part because of seasonal activity. Energy industry support jobs overall climbed 2%, to 138,100 from 135,400.

During July, the state’s upstream sector added 3,600 jobs, marking the 10th consecutive month of job growth for the oil and gas industry, the TWC said. From September 2016 through July, the state added 24,500 oil and natural gas extraction jobs, including for support activities. The upstream workforce does not include jobs within the refining, petrochemicals, fuels wholesaling, oilfield equipment manufacturing, pipelines and gas utilities sectors.

“Steady job growth indicates a solid recovery continues in the Texas oil and natural gas industry,” said Texas Oil and Gas Association President Todd Staples. “Of the 108,000 jobs lost from peak upstream employment in December 2014 to its low point in September of 2016, we have now recovered 23% of the jobs in less than a year.”

Returning these “high-paying jobs is a visible reminder that Texas’s commitment to sound, science-based regulations is encouraging investment here,” he said.

The TWC said overall, the trade, transportation, and utilities Industry recorded the largest private-industry gain month/month in August, adding 9,100 jobs. Construction expanded by 2,600 jobs and has added 15,200 jobs since the start of the year. Manufacturing saw an increase of 2,200 jobs in August, representing a 4.2% employment growth rate over the year, the industry’s highest annual growth rate since March 2012.

The Houston area, which was limping to an energy sector recovery following the swoon in oil prices in 2014, has lagged the state overall, with a 1.8% increase in jobs for the year to date.

 The Amarillo Metropolitan Statistical Area (MSA) recorded the month’s lowest unemployment rate in Texas with a nonseasonally adjusted rate of 3.1%, followed by the Midland MSA with a rate of 3.2%. Midland is the epicenter for Permian Basin activity, with Amarillo also seeing higher employment related to oil and gas.

The TWC noted it was concerned about the impact of Hurricane Harvey on employment. Harvey’s lingering impact on the Texas energy sector has forced producers to reduce guidance, not only from shut-ins in the Eagle Ford Shale, but also because of petrochemical limitations at Gulf Coast processing facilities.

Gov. Greg Abbott said Friday the TWC has been awarded a $30 million National Dislocated Worker Grant by the U.S. Department of Labor (DOL) to provide funding for temporary jobs for eligible individuals to assist with cleanup, recovery and humanitarian efforts in areas impacted by Harvey. These grants are to be administered in partnership with the Federal Emergency Management Agency (FEMA) and local officials in affected communities.

"Texas' most valuable resource is its people, and these grants will go a long way in getting our people back to work,” said Abbott. "In this time of need, I want to make sure Texas families have what they need, as well as ensure a swift and effective recovery process, and these grants will help us accomplish both of these urgent matters.”

TWC Chairman Andres Alcantar said, “We will build partnerships and offer services to assist dislocated workers, respond to the needs of Texas businesses and rebuild Texas communities impacted by Hurricane Harvey. These funds will support our efforts, including those of our local workforce boards, to build and deploy a broad range of responsive strategies to meet the needs in our local communities.”

TWC data in September likely will record a boom in construction jobs and a sharp decline in coastal tourism and leisure jobs, based on historical data.

The construction sector already has added 15,200 jobs this year, said Commissioner Julian Alvarez, who represents TWC’s labor sector. For anyone unable to work because of the hurricane, he suggested contacting the TWC for information on disaster recovery resources. 

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