Austin Economic Indicators
October 1, 2020
The Austin economy continued to improve in August. The Austin Business-Cycle Index accelerated. While jobs and the unemployment rate improved in June, July and August, neither metric has returned to its March level. Regional consumer spending since mid-July held at pre-COVID-19 levels. Existing-home sales dipped but remained strong, and building permits rose.
The Austin Business-Cycle Index—a broad measure of economic activity in the metro—increased for the fourth consecutive month at a 34.4 percent (nonannualized 2.5 percent) rate in August, indicating continued improvement in the Austin economy (Chart 1).
Unemployment Rate Declines
Austin’s unemployment rate fell further to a still-elevated 5.4 percent in August (Chart 2). The jobless rate ticked down to 6.8 percent in Texas and 8.4 percent in the nation.
Most Sectors Post Job Gains
Austin payrolls expanded 6.1 percent (nonannualized), or by 62,620 net jobs, in the three months ending in August (Chart 3). Leisure and hospitality led the expansion with a 19.1 percent increase, or 16,570 jobs. This was followed by other services (18.4 percent, or 6,750 jobs), health and private education services (8.9 percent, or 10,150 jobs) and government (5.9 percent, or 10,310 jobs). Sectors that experienced losses were construction and mining (-1.2 percent, or 840 jobs) and information (-0.6 percent, or 210 jobs). Manufacturing and financial activities were the only sectors to post positive job growth for the first eight months of the year.
Since mid-July, consumer spending (measured by credit and debit card spending) in Travis County has remained above January 2020 levels. As of Sept. 20, spending in the county was up 9.4 percent relative to January, whereas spending in Texas was up 0.1 percent over the same period (Chart 4).
Year-to-Date Home Sales Strong
Existing-home sales in August contracted 0.8 percent in Austin and 3.6 percent in the state (Chart 5). However, the metro’s home sales are up 1.4 percent during the first eight months of the year relative to the same period in 2019; Texas sales increased 2.9 percent. The median price of homes sold in August was $347,765 in the metro, a 9.7 percent rise year over year, compared with $260,226 in Texas, a 6.6 percent gain.
Home Construction Permits Continue to Rebound
From July to August, the five-month moving average of total housing permits (single family and multifamily) strengthened 4.8 percent in Austin while decreasing 1.0 percent in the state (Chart 6). Austin’s existing-home inventories ticked down to 1.2 months, the lowest since the data series began in 1990 and considerably below the six months of supply considered to be a balanced market.
NOTE: Data may not match previously published numbers due to revisions.
About Austin Economic Indicators
Questions can be addressed to Judy Teng at firstname.lastname@example.org. Austin Economic Indicators is released on the first Thursday of every month.