Dallas–Fort Worth Economic Indicators July 3, 2024

Dallas-Fort Worth Economic Indicators

The Dallas-Fort Worth economy expanded in May. Employment growth remained strong but moderated from April's brisk pace. Average hourly earnings held steady, above year-ago levels, and inflation ticked up in May. Home sales dipped in May, and home prices rose in the first quarter.

Labor market

Job growth mixed

Employment in DFW rose 2.4 percent in May after climbing 4.8 percent in April (Chart 1). Job growth was mixed across the major sectors, with strong gains seen in construction, finance, and trade, transportation and utilities. Employment held largely steady in the education and health services and leisure and hospitality sectors but declined in information, professional and business services, and other services. The unemployment rate in DFW was unchanged at 3.8 percent.

Hourly wages flat

DFW private hourly earnings were $34.30 in May, little changed from April's figure of $34.35. The three-month moving average of hourly earnings ticked up to $34.35, remaining above the state average of $32.62. However, DFW private hourly earnings were below the national average of $34.79 (Chart 2). Wage growth in DFW has slowed over the past year, with wages up 1.5 percent year over year in May-less than gains of 5.5 percent in Texas and 4.1 percent in the U.S.

Inflation

The Dallas headline consumer price index (CPI) rose 5.0 percent in May, up from April's reading of 4.8 percent (Chart 3). CPI core inflation, which excludes food and energy, rose 5.0 percent. Energy is one of the most volatile goods that consumers purchase. In May, energy prices in Dallas were up 12.2 percent annually, while food and shelter components of the CPI trended down to 2.0 percent and 6.8 percent, respectively. Meanwhile, the 12-month change in the U.S. CPI was 3.3 percent in May, down slightly from 3.4 percent in April.

Housing

Existing-home sales dip

Housing demand weakened in May. DFW existing-home sales declined 1.1 percent after rising strongly in April (Chart 4). Statewide, sales dropped 2.2 percent, while they fell 0.7 percent nationally. According to business contacts, high mortgage rates and prices are dampening affordability, limiting home sales. Incentives such as discounting and rate buydowns remained prevalent, and existing-home inventories rose to 3.6 months of supply in DFW and 4.5 months in Texas.

Home prices appreciate in first quarter

Home prices in DFW rose in the first quarter, according to recently released data from the Federal Housing Finance Agency. Compared with the fourth quarter, prices rose 1.1 percent in Dallas and 1.5 percent in Fort Worth. Meanwhile, prices rose 1.0 percent in Texas and 1.1 percent in the U.S. over the same period. Year over year, home prices grew 4.4 percent in Dallas, 3.0 percent in Fort Worth and 3.3 percent in Texas, all lower than the nation's 6.6 percent increase (Chart 5).