Texas Service Sector Outlook Survey

Texas Service Sector Outlook Survey

Texas service sector activity strengthens

Texas service sector activity accelerated in September, according to business executives responding to the Texas Service Sector Outlook Survey. The revenue index, a key measure of state service sector conditions, rose to 10.1, the highest level in 13 months.

Labor market measures suggested little growth in employment in September and no change in hours worked. The employment index held fairly steady at 2.0 while the part-time employment index was flat. The hours-worked index was unchanged at -0.8.

Perceptions of broader business conditions were mixed in September. The general business activity index improved to -2.6, with the negative reading still signaling worsening activity. The company outlook index increased four points to 1.2. The outlook uncertainty index fell five points to 9.4.

Wage and selling price pressures held steady, while input price pressures eased in September. The selling price index was basically unchanged at 5.4, while the input price index fell five points to 23.3. The wages and benefits index fell two points to 12.3.

Respondents' expectations regarding future business activity reflected optimism in September. The future general business activity index jumped 13 points to 16.0, while the future revenue index increased four points to 35.1. Other future service-sector activity indexes such as employment and capital expenditures remained in positive territory, reflecting expectations for continued growth in the next six months.

Texas Retail Outlook Survey

Texas retail sales contraction continues

Retail sales activity declined in September, according to business executives responding to the Texas Retail Outlook Survey. The sales index, a key measure of state retail activity, fell three points to -8.9. Retailers' inventories were unchanged over the month, with an index reading near zero.

Retail labor market indicators suggested a contraction in employment and workweeks this month. The employment index fell two points to -7.7, while the part-time employment index remained in negative territory but increased to -5.0. The hours-worked index was basically unchanged at -9.9.

Retailers continued to perceive a worsening of broader business conditions in September. The general business activity index was practically unchanged at -14.9. The company outlook index fell seven points to -18.5, and uncertainty in outlooks increased.

Selling price growth increased slightly in September, while input price growth moderated. Wage pressures held steady from the prior month. The selling price index increased two points to 3.1, while the input price index fell five points to 16.3. The wages and benefits index was essentially unchanged at 3.9.

Expectations for future business conditions in retail were mixed in September. The future general business activity index dipped into negative territory, falling four points to -1.8, while the future sales index was positive and largely unchanged at 15.8. The future employment index remained in negative territory for the third month in a row, and the capital expenditures index with its near-zero reading signaled no growth in capital expenditures six months from now.

Next release: November 26, 2024