The local economy declined in the latter months of 2020 after a summertime recovery, according to a report from Texas A&M economists released this week.
The unemployment rate for the Bryan-College Station metro area increased to 5.9% in November from 4.8% in October but remained the second-lowest rate among Texas metropolitan areas, according to monthly findings shared by Texas A&M’s Private Enterprise Research Center.
In a Zoom interview, PERC executive director Dennis Jansen and executive associate director Andy Rettenmaier said the November jump in unemployment corresponded with the statewide rate’s movement, which increased from 6.9% in October to 8.1% in November. In December, the Texas unemployment rate decreased to 7.2%, according to the Texas Workforce Commission.
“The current rate of 5.9% is second-lowest in the state, behind Amarillo, and yet it is more than double our pre-COVID unemployment rate,” Rettenmaier said. The local unemployment rate rose from 4.3% in August to 5.6% at the end of September, and then moved to 4.8% in October. A year ago, the local rate hovered at about 2.7%.
The economic index, a combined set of factors including the unemployment rate, taxable sales and nonfarm employment, shows a local economy that has fluctuated in recent months. The area’s economy reversed in the fall following four consecutive months of mid-pandemic economic recovery over the summer.
“Locally, we’ve had some negative results in the last several months,” Jansen said. “Focusing on recent times, the last couple months have been tough around here. I don’t think we’re doing appreciably worse, but we’re not doing better — and we might be doing a little bit worse.”
Jansen added that the rise in unemployment claims in December and January likely do not bode particularly well for reports in the near future regarding the area’s economic strength.
“If we went back in time, we wouldn’t see anything like this,” Rettenmaier said of the pandemic economy in a historical perspective. “We were going back to normal, if you will, but you can see that we’ve had some fits and starts since then.”
The economists said that fluctuations during the pandemic are a result not only of imposed restrictions but individual responses to COVID-19 case numbers. Rettenmaier and Jansen said that economic patterns are following, at least to some degree, COVID-19 active case numbers and related individual behavioral choices. Some industries are particularly impacted by those choices, he said.
“Yes, the government has imposed restrictions, but even if you loosen those, people’s behavior is formed by what they view as their optimal response to their chances of getting what could be a terrible disease,” Jansen said.
Local nonfarm employment increased by 0.23% in November, and was 4.9% lower than the November 2019 figure. Local real taxable sales increased 2% from October to November but were 6.7% lower than the same month last year. The index runs with a lag time of approximately two months.
Only Amarillo had a lower unemployment rate among Texas metro areas in November, according to Bureau of Labor Statistics data. Notably, Jansen said, the Austin-Round Rock metropolitan area’s unemployment rate was 6%, the third-lowest rate in Texas. He said the Austin economy has been strong and that usually such a large metropolitan area does not usually rank so well in Texas.
The national unemployment rate was 6.7% as of December, according to the Bureau of Labor Statistics.
Weekly unemployment insurance claims for the area, though still much lower than early-pandemic figures, have been higher in December and January than in October or November. Rettenmaier said 598 claims were filed in the first two weeks of January combined, the highest numbers since the first week of September.
Gross domestic product data at the county and metro area levels are released with a lag time of one year, Rettenmaier explained, so 2019 figures were unveiled recently. In 2019, the economists said, Brazos County accounted for 68% of all economic activity in the three-county metro area, producing $9.63 billion of the MSA’s $14.2 billion total GDP.
Robertson County produced 20% of the metro area’s total GDP, and Burleson County produced 12%. From 2001 through 2019, Brazos County’s GDP has risen steadily, while Robertson County’s experienced a peak in 2009 and has declined or held steady in the years since.
The number of passengers flying out of Easterwood Airport each month — which dropped sharply from February to April last year — rose over the summer and held steady in the last three months of 2020. Enplanements in December 2020 were 58% of December 2019 levels, the highest percentage of the 2019 corresponding monthly total since February.
To view the latest Economic Indicators report from PERC, visit perc.tamu.edu.