Texas job growth imperiled as crude sinks below $30



HOUSTON — If crude prices don’t climb back up to $40 to $50 a barrel for several months then Texas job growth will probably turn negative in 2016, according to the Dallas Fed.

The Federal Reserve Bank of Dallas said Tuesday it expects Texas to add 161,200 jobs this year, roughly a third the job-growth rate in 2014. But that’s only if crude prices hover around $40 to $50 a barrel for a big chunk of the year.

“The biggest risk to the forecast is if oil prices are in the range of $20 to $30 for much of the year,” Dallas Fed Senior Economist Keith Phillips said in a written statement. “Then I expect job growth to slip into negative territory as Houston gets hit much harder and greater problems emerge in the financial sector.”

U.S. crude briefly fell below $30 a barrel on Tuesday, dropping $1.48 to $29.93 a barrel in midday trading on the New York Mercantile Exchange. That’s the lowest intra-day trading level since December 2003.

If crude prices recover by a third to two thirds this year, Texas payrolls would likely grow slightly faster than last year. But even then, job growth would come in well below the 410,900 jobs the state added in 2014, the Dallas Fed said.