The COVID-19 pandemic had a significant impact on the Texas economy, leading to a sharp increase in unemployment rates. In March 2020, the unemployment rate in Texas skyrocketed to 12.8%.
The industries hit hardest by the pandemic were tourism, hospitality, and retail, which saw massive job losses. According to data from the Texas Workforce Commission, the leisure and hospitality sector lost over 100,000 jobs in March 2020 alone.
The unemployment rate in Texas peaked in April 2020 at 13.5%, affecting nearly 1.8 million workers. This was the highest unemployment rate in Texas since 1975.
The pandemic also disproportionately affected certain groups, including low-wage workers and those in the service industry.
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Coronavirus Recession Impact
The coronavirus recession had a significant impact on Texas, with varying levels of joblessness across the state.
Unemployment rates were particularly high in South Texas, where many people work in oil fields.
Starr County recorded the highest unemployment rate in Texas at 21.7% in April 2020, affecting one in five residents age 16 and older.
The oil-rich Permian Basin counties of Yoakum, Crane, and Ector saw significant job losses in 2020, particularly in the manufacturing, natural resources, and mining sectors.
Large urban counties also experienced significant decreases in employment, but these areas were slowly recovering by May 2021.
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Unemployment Rate by Location
The unemployment rate in Texas varied significantly across counties, with some experiencing higher rates than others. Unemployment was the worst in April 2020, when the state shut down.
The data from the Bureau of Labor Statistics and the Texas Workforce Commission shows that counties were rebounding by May 2021, although most were not back to pre-pandemic levels. Unemployment rates for each county are not seasonally adjusted.
Here's a snapshot of the unemployment rate across the state:
- April 2020: Unemployment rates were highest due to the state shutdown.
- May 2021: Counties were rebounding, but most were not back to pre-pandemic levels.
Looking at the bigger picture, the unemployment rate in Texas from 1992 to 2023 shows some fluctuations over the years.
Labor Force Data
Labor Force Data is crucial when analyzing unemployment rates for Texas.
The Bureau of Labor Statistics (BLS) uses a program called CES to track employment numbers.
Revisions of historical CES data are made once a year, concurrent with annual benchmark adjustments.
CES Employment estimates are adjusted annually to a complete count of jobs, called benchmarks, derived from tax reports submitted by employers covered under state unemployment insurance laws.
The benchmarking process establishes the level of employment, and the sample is used to measure month-to-month changes in the level for subsequent months.
Data Reliability and Sources
The estimates of unemployment rates for Texas are based on sample surveys, administrative data, and modeling, which means they're subject to sampling and other types of errors. These errors can occur by chance because a sample rather than the entire population is surveyed.
Sampling error is a measure of sampling variability, and survey data can also be subject to nonsampling errors, such as those introduced into the data collection and processing operations. Estimates not directly derived from sample surveys are subject to additional errors resulting from the specific estimation processes used.
Changes in Texas unemployment rates and nonfarm payroll employment are only cited if they're statistically significant at the 90-percent confidence level. This means they've been determined to be significantly different from the U.S. rate at the same confidence level.
The underlying model-based standard error measures for unemployment rates and over-the-month and over-the-year changes in rates are available online. You can find them at www.bls.gov/lau/lastderr.htm.
Economic Context
The unemployment rate in Texas has been a topic of interest for many years.
Unemployment rates in Texas have fluctuated significantly over the past three decades.
From 1992 to 2023, the unemployment rate in Texas has shown a downward trend, indicating a strong economy.
In 1992, the unemployment rate was at its highest, with a rate of around 6.5%.
The unemployment rate in Texas has been steadily decreasing since 1992, with some minor fluctuations along the way.
This is a positive sign for the state's economy and job market.
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