Texas unemployment rate at lowest point since 1976; Houston rate drops to 3.8 percent…Gasoline prices drop for third straight week…Consumer sentiment showing softness so far in June…
The Texas unemployment rate fell to 4.1 percent in May. That’s the lowest point since at least 1976. The Texas Workforce Commission said the May rate is a below April’s jobless rate of 4.2 percent. A year ago, the Texas jobless rate was five percent. Houston’s rate stayed steady at 3.8 percent. The commission estimated that Texas added 22,700 jobs in May and 239,000 over the past 12 months. The agency estimates the annual job growth rate at 2.4 percent. That’s nearly double the national increase of 1.4 percent. The state figures are adjusted for seasonal trends in hiring and firing. Local figures aren’t adjusted. Midland had the lowest unemployment rate of any Texas metropolitan area, at 2.6 percent. The Rio Grande Valley area around McAllen, Edinburg and Mission had the highest rate at 5.7 percent. The biggest increase in jobs came in professional and business services, which added 5,400 jobs. Education and health services gained 4,900 jobs. Trade, transportation and utilities gained 2,600 jobs. Mining, which includes the oil and gas industry, added 1,600 positions.
Retail gasoline prices fell this week across Texas for the third week in a row after reaching record levels. The weekly AAA Texas gas price survey found regular-grade gasoline is averaging $2.95 per gallon. That’s six cents less than last week and almost 14 cents less than the record of $3.09 set last month. The national average is $3.04 per gallon. That’s down eight cents from last week. Houston’s average is down over six cents to $2.91 per gallon. Of the 11 Texas cities in the poll, El Paso has the most expensive gas with regular-grade averaging $3.19 per gallon. That’s down six cents from last week. The cheapest gas is in Corpus Christi, where regular-grade averages $2.84 per gallon. That’s down nine cents from last week.
A new look at inflation shows an increase, but not a troubling amount. Underlying inflation remained under wraps, bringing it down closer to the Federal Reserve’s comfort zone. The Labor Department says the consumer price index rose last month at the fastest pace in almost two years on sharply higher energy prices. Overall CPI was up seven-tenths of a percent in May, but the more significant core rate, which excludes volatile food and energy costs, advanced just one-tenth of one percent. That’s down from two-tenths of a percent the previous month. The headline CPI is slightly higher than expected but the core rate is slightly lower, and that’s what the Fed looks at when deciding monetary policy. Overall consumer inflation was up 2.7 percent from a year ago. However, the core CPI was up just 2.2 percent compared to a year ago, down a tenth of a percentage point from April and the slowest annual increase in 15 months.
Consumer sentiment is showing a little softness so far this month. The University of Michigan’s survey of consumer sentiment for early June came in at 83.7 after hitting 88.3 in May. Economists surveyed by Dow Jones Newswires had been looking for a smaller decline–to 87. The report also shows consumers’ assessment of current conditions for the middle of June and expectations were both down.
A drop in utilities output kept industrial production unchanged last month. At the same time it released the May report, the Federal Reserve reported its April figures to show an increase in output of just four-tenths percent. The previous estimate was seven-tenths percent. The flat performance surprised Wall Street, which had been calling for a gain of one-tenth percent. In addition, the Fed says the nation’s factories, mines and utilities operated at 81.3 percent of capacity in May–down a couple of clicks from April.
The government says the broadest measure of the nation’s trade gap increased in the first three months of this year, pushed higher by rising oil prices. The Commerce Department says the imbalance in the current account increased 2.5 percent in the first quarter. It rose to $192.6 billion, from $187.9 billion in the fourth quarter. The increase was slightly below what analysts had been expecting. The current account is the most complete measure of trade because it tracks not only trade in goods and services but also investment flows between countries.
Baker Hughes in Houston reports the number of rigs actively exploring for oil and natural gas in the U.S. rose by 13–to reach 1,773. One year ago the rig count stood at 1,672. Texas lost three rigs.