LOCAL ECONOMIC SNAPSHOT | TEXAS ECONOMY UNDER RICK PERRY

Lone Star financial state

TOM SETZER

By BRENDAN CASE
Staff Writer bcase@dallasnews.com Staff Artist tsetzer@dallasnews.com

In seeking the Republican presidential nomination, Gov. Rick Perry has touted job creation in Texas since he became governor in December 2000. Texas job growth has far outpaced the national average since then, while wages have grown at about the same rate. Perry supporters credit his businessfriendly policies. Texas has also benefited from upward trends in oil prices, a relatively stable housing market and an increase in government jobs since the recession began in December 2007.

Expanding payrolls
Texas employers have expanded payrolls by 11 percent since Perry took office in December 2000, fueled in part by population gains, compared with a 0.9 percent decline for the nation as a whole. During that period, average wages have increased at about the same rate as the national average. Below, a look at two job market indicators: Payroll changes for Texas and the nation indexed to December 2000, and the unemployment rates in Texas and the U.S. over the same period. Payroll changes
(Through September) 120 115 110 105 100 95 90 01 02 03 04 05 06 07 08 09 10 11 SOURCE: U.S. Bureau of Labor Statistics; indexing by The Dallas Morning News

Unemployment rate
(Through September) 12%

Texas: 111.241

10% 8% 6%

U.S.: 9.1%

Texas: 8.5%

Dec. 2000 = 100

U.S.: 99.131

4% 2% 0 01 02 03 04 05 06 07 08 09 10 11 SOURCE: U.S. Bureau of Labor Statistics

Historical job growth

The states superior performance is nothing new. A look at average annual job growth during the terms of the last three governors:

Oil
The Texas economy is not as reliant on oil and gas as it once was, but the energy industry is still important. A 10 percent increase in oil prices leads to a 0.5 percent increase in state economic output and a nearly 0.4 percent increase in jobs, according to a Federal Reserve Bank of Dallas report. Oil price increases in recent years have helped the state economy outperform the national average. U.S. spot price per barrel
$150 $120

Ann Richards
January 1991-January 1995 2.7%

12-month percentage change in Texas mining and logging payrolls*

20% 15% 10% 5% 0

September $85.63

September 18.4%

George W. Bush
January 1995-December 2000 3.2%

$90 $60 $30 0

01 02 03 04 05 06 07 08 09 10 11

Rick Perry
December 2000-present* 0.9%
* Annual averages computed through Dec. 2010 SOURCE: U.S. Bureau of Labor Statistics; Dallas Morning News research

-5% -10% -15% -20%

01 02 03 04 05 06 07 08 09 10 11

* Includes oil and gas extraction SOURCES: U.S. Energy Information Administration; U.S. Bureau of Labor Statistics

Debt
Texas missed out on much of last decades housing boom, and it also dodged the worst of the housing bust. As a result, per capita debt levels have been much more stable than in many other large states an important advantage at a time when many U.S. households are cutting spending in order to reduce debt.
(Per capita debt in thousands of dollars for households with credit reports by quarter, from 1999 through the second quarter of 2011)
$100 $80 $60 $40 $20 0 00 05 10 00 05 10 00 05 10 00 05 10 00 05 10 00 05 10 00 05 10 00 05 10 SOURCE: Federal Reserve Bank of New York

Arizona

California

Florida

Nevada

New York

Pennsylvania

Texas

U.S.

The bottom line

Natural resources, favorable demographics, a good location, the tech sector and many other factors contribute to our relative success. Gov. Perry is not responsible for these things. But he led the charge for the Texas Enterprise Fund, the Emerging Technology Fund, judicial reforms and other measures that have helped improve the state's performance. Ray Perryman, president, The Perryman Group Texas has had higher job growth than the U.S. overall, not because of Gov. Perry, but because this recession was less concentrated on our major industries. Also, longstanding legal restrictions protected us from the national housing bubble. We have a low-volatility economy but one with low wages and benefits, and a high percentage of people without health insurance. Daniel Hamermesh, professor of economics, University of Texas at Austin While Gov. Perry argues for smaller government, public-sector jobs account for 17 percent of Texas employment, similar to the national average. During the U.S. recession, government jobs grew 3.9 percent in Texas while private-sector jobs fell 3.5 percent. Since the recession ended, government jobs have edged down and the private sector has come to the fore. Brendan Case, staff writer, The Dallas Morning News