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Texas Economy Likely To Slow In 2015, Comerica Says

With crude oil below $50 per barrel and rig counts falling, layoffs are on the way.

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Comerica Bank’s Texas Economic Activity Index

 

Comerica Bank’s Texas Economic Activity Index registered 107.8 in October, up 0.5 percentage points from September. The index reflects strong employment growth, crude oil in the mid-$80 per barrel range, and stable drilling activity. Since October, the price of crude oil has dropped to less than $50 per barrel and the state’s rig count is falling.

Robert Dye, Comerica’s chief economist, says that will mean layoffs, and not just in the oil business. “The energy sector provides major connections, a strong economic multiplier effect to other businesses, everything from steel and manufacturing to the neighborhood grocery store and restaurants and so forth that workers use,” Dye says.

On the plus side, cheaper crude oil means lower costs for Texas refiners and transportation companies. “Also,” Dye says, “we have the support of a strengthening U.S. economy. We had very solid U.S. economic growth over the second half of last year, and we expect to see very solid ongoing economic growth nationwide.” He expects lower oil prices to act as a net drag on the Texas economy throughout 2015.

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Andrew Schneider

Andrew Schneider

Politics and Government Reporter

Andrew heads Houston Public Media’s coverage of national, state, and local elections. He also reports on major policy issues before the Texas Legislature and county and city governments across Greater Houston. Before taking up his current post, Andrew spent five years as Houston Public Media’s business reporter, covering the oil...

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