Dallas Fed: Texas employment forecast strengthens for 2025

DALLAS — The Texas Employment Forecast released by the Federal Reserve Bank of Dallas indicates jobs will increase 1.9 percent in 2025, with an 80 percent confidence band of 1.2 to 2.6 percent.

This is an increase from the previous month’s forecast of 1.6 percent for 2025.

The forecast is based on an average of four models that include projected national GDP, oil futures prices,?and the Texas and U.S. leading indexes. In addition, this forecast utilizes Texas employment data that have been adjusted to include anticipated downward revisions by the Bureau of Labor Statistics.

“January job growth was strong and broad based, led by increases in the energy and education and health sectors. Only employment in the information sector dropped,” said Jesus Cañas, Dallas Fed senior business economist. “Additionally, employment rose in all major metropolitan areas of the state, with Houston outpacing the other major metros.”

Additional key takeaways from the latest Dallas Fed report:

The forecast suggests 275,000 jobs will be added in the state this year, and employment in December 2025 will be 14.5 million.

Texas employment increased by an annualized 3.4 percent month over month in January, an increase from December’s growth of 2.9 percent.

The unemployment rate, which takes into account changes in the total labor force along with other factors, decreased in Austin–Round Rock, Brownsville–Harlingen, El Paso, Fort Worth–Arlington, Houston–The Woodlands–Sugar Land, Laredo and San Antonio–New Braunfels, according to?seasonally adjusted numbers?from the Dallas Fed.

The rate remained flat in Dallas–Plano–Irving for the month.

The Texas statewide unemployment rate decreased slightly to 4.1 percent in January.