The Federal Reserve Bank of Dallas lowered its forecast for Texas employment growth in 2026 to 0.9%, following a decline in jobs in September. The forecast implies an increase of 134,000 jobs during the year, bringing employment to 14.5 million in December 2026. Its 80% confidence band ranges from 0.6% to 1.2% growth. Texas employment fell at an annualized rate of 1.6% in September, slowing growth for the year to date to 0.8%, below the state's long-term average of 2%. August's annualized growth rate was revised upward to 2.3%. Dallas Fed senior business economist Luis Torres linked the moderation to labor supply constraints partly resulting from sharply lower immigration. Most sectors lost jobs in September, but manufacturing benefited from oil and gas activity, export growth and construction related to artificial intelligence expansion. The statewide unemployment rate remained unchanged at 4.4%.
Federal Reserve Bank of Dallas lowers Texas employment growth forecast to 0.9% for 2026
The Federal Reserve Bank of Dallas cut its 2026 Texas employment growth forecast to 0.9%, equivalent to 134,000 additional jobs and total employment of 14.5 million by December. Employment fell at an annualized rate of 1.6% in September, leaving growth for the year to date at 0.8%, below the state's long-term average of 2%. Labor supply constraints partly linked to lower immigration weighed on growth, while the statewide unemployment rate held at 4.4%.