San Antonio on track for 2.5% job boost
SAN ANTONIO — San Antonio remains on track to end the year with job growth in the 2.5 to 2.6 percent range, economist Steve Nivin said Wednesday.
A 2.5 percent rate means the area will produce a net gain of about 22,800 jobs this year, said Nivin, SABÉR Research Institute’s chief economist.
The job-growth rate is mostly good news. It’s faster than both the national rate and San Antonio’s long-term job-growth pace. But it’s slower than the forecast for Texas as a whole.
U.S. job growth this year will be about 2 percent, Keith Phillips, Federal Reserve economic policy adviser, speaking with Nivin, told 170 people attending a midyear economic outlook luncheon held by the San Antonio Hispanic and North San Antonio chambers of commerce.
San Antonio’s long-term annual job-growth rate — going back to 1991 — is 2.26 percent, Nivin said.
Nivin had given a wider range at a similar event five months ago, predicting job growth of 2.5 percent to 3 percent for 2014.
He also forecast an unemployment rate of 4.8 percent to 5 percent for the year. In July, the area’s unemployment rate stood at 4.8 percent. Nivin expects it to plateau or edge down slightly for the rest of the year.
San Antonio’s job-growth rate trails the projected statewide pace of 3.5 percent in 2014, Phillips said. The Texas rate is faster than last year’s 2.7 percent but about the same as in 2012, which was 3.4 percent, Phillips said.
A side effect of that job growth in both Texas and San Antonio is that companies are beginning to feel wage pressure, Nivin and Phillips said. They said that although they have not yet heard of companies increasing wages to find new workers, businesses are complaining that new employees are becoming more difficult to find.
Texas’ job growth is driven by energy, construction and exports, Phillips said. “It’s going to be a good year for the state of Texas,” he said.
Nivin said San Antonio’s job growth is broad-based, with gains across every sector. Financial activities, construction/mining, education, health care, tourism and professional business services have shown the best gains, he added.
San Antonio’s job-growth trend since the end of the 2007-09 recession is showing the same upward trajectory as in 2004-2007, Nivin added. “We hit our stride rather quickly (after the recession) and have kept the pace,” he said.
San Antonio’s job growth between July 2013 and July 2014 was 2.17 percent, which is below the state’s 3.22 percent but higher than the U.S. pace of 1.88 percent, Nivin said. All other large Texas cities except Dallas were higher than San Antonio during that period.
Texas’ economic momentum has continued to accelerate, even since regaining the jobs lost during the recession by early 2012. The United States didn’t regain its lost jobs until this May, Phillips said.
The economists also addressed the housing market locally and statewide.
The single-family housing market is strong across Texas, leading to rising house values, Nivin said. A six-month supply of houses on the market is considered a healthy level, but San Antonio’s supply is about 4.5 months. It’s below four months across Texas as a whole.
The national housing supply is 5.2 months.
The Texas single-family market is being held back by the lack of vacant lots ready for construction, especially in Houston, Phillips said.