Dallas Fed: Texas businesses report wage and price growth retreat; remote work decreases slightly

News Releases

September 30, 2024

DALLAS-Texas businesses reported wage and input price growth retreated notably over the past three months, and selling price growth abated slightly, according to executives responding to a survey from the Federal Reserve Bank of Dallas. Further easing is expected over the next year.

From Sept. 17-25, the Dallas Fed asked a series of special questions on wages, prices, outlook concerns and remote work in the Texas Business Outlook Surveys and heard back from 326 business executives.

Key takeaways:

• On average, responding firms saw a 4.4 percent increase in wages over the past 12 months, and expect wage growth of 3.7 percent over the next 12 months. For input price cost growth, the average was 4.1 percent (past 12 months) and 3.2 percent (next 12 months). For selling price growth, the average was 3.0 percent and 2.7 percent, respectively.
• Nearly half of respondents noted domestic policy uncertainty as a primary concern for their firm's outlook, up from 38 percent in June. The share citing the level of demand as a top concern inched up from June, while the share citing inflation, labor costs and interest rates fell notably.
• Texas firms reported that 30 percent of their employees work remotely on average, including both hybrid and fully remote. This is down slightly from a year ago, and respondents cited improvement in teamwork/collaboration and building company culture as top reasons motivating the decrease in remote work.

Some manufacturing continues to weaken

"The Texas manufacturing sector posted another month of little to no growth in August, and demand weakness continued," said Emily Kerr, senior business economist at the Dallas Fed. "Employment levels were stable overall. Outlooks softened, though expectations for future activity remained positive."

Key takeaways from this month's Texas Manufacturing Outlook Survey :

• The production index inched up three points to 1.6, with the low reading signaling little growth in output from July.
• The new orders index climbed nine points to -4.2.
• Labor market measures suggested flat employment and slightly shorter workweeks.
• Moderate upward pressure on prices and wages continued in August.
• The general business activity index rose eight points to -9.7, and the company outlook index rose nine points to -9.6.

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Media contact:
Jon Prior
Federal Reserve Bank of Dallas
Phone: 214-922-6857
Email: [email protected]

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