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Texas added 99,000 jobs in the last month, but the unemployment rate is still up from last year

Texas' unemployment rate was
in March, up from 4.9% in March 2020.
In March, Texas collected
$2.5 billion
in sales tax revenue, down 8.6% from March 2020.

The unemployment rate in Texas was 6.9% in March, which is more than double the record low of 3.4% in May 2019. In February, Texas' economic struggles were exacerbated as a deadly winter storm knocked large swaths of the state off the power grid for days and made roads impassable. The storm also impacted state sales tax revenue in February.

In March, the number of unemployment claims Texans filed each week jumped to levels not seen since last summer. Experts say that’s due to the February storm and a new congressional aid package that extended some benefits. But economists are optimistic that increased coronavirus vaccinations will help stabilize and improve the state’s economic recovery.

Still, the state’s outdated and understaffed unemployment insurance office has left countless Texans struggling to receive unemployment benefits as they navigate the Texas Workforce Commission’s confusing processes.

Business shutdowns and limits battered Texas companies, which can now largely operate at full capacity. But businesses must choose whether to require their customers wear masks.

A decline in Texas’ sales tax revenue — the largest source of funding for the state budget — has created a shortfall that lawmakers will have to fill in the 2021 legislative session.

The unemployment rate stayed the same in March

Texas’ unemployment rate in March was 6.9%, which is the same as the 6.9% February jobless rate, according to a Bureau of Labor Statistics report released April 16. March data shows the loss of around 400,000 Texas jobs in the last year. But there are continued signs of improvement — and from February to March, 99,000 jobs were added.

A deadly winter storm in February brought record-low temperatures and left millions without access to electricity when the state’s electric grid operator lost control of the power supply. The storm could be the costliest disaster in state history, potentially exceeding the financial toll from Hurricane Harvey.

Unemployment rate

Unemployment by county

The impact of the coronavirus recession varies widely across Texas. The latest data showing how the unemployment rate varies in Texas counties is from March, after the winter storm impacted the economy.

Joblessness is the worst in South Texas, where many people work in oil fields, but the region is slowly recovering. Several counties, including Starr, Cameron, Hidalgo and Willacy, recorded lower unemployment rates in March than in February. Unemployment in Austin’s Travis county is at 5.3%, the lowest rate among Texas’ most populous urban counties. And some rural counties throughout the state have unemployment rates below 4%.

Unemployment rate by county, March 2021

Sales tax revenue is down after the winter storm

In March, Texas collected $2.5 billion in sales tax revenue, down 8.6% from what the state collected in March 2020. The revenue came mostly from purchases made in February, when many businesses were affected by widespread power outages created by the winter storm. The total revenue for January, February and March was down 5.3% compared with the same period in 2020.

This year, March’s revenue does not include receipts submitted on March 1. Texas Comptroller Glenn Hegar extended the deadline for February’s receipts and included March 1 submissions in the previous month’s revenue.

Receipts from restaurants were up over the previous year’s levels for the first time since the start of the pandemic, according to Hegar. Oil and gas receipts were still down.

Change in sales tax revenue from previous year

About this data

The unemployment rate for Texas is updated on the third Friday of each month with data from the Bureau of Labor Statistics Local Area Unemployment Statistics program or the Texas Workforce Commission. The unemployment rate published each month is preliminary. County unemployment rates are generally updated two weeks after the statewide rate. Sales tax revenue data is updated at the beginning of each month.

Disclosure: The Texas Comptroller of Public Accounts has been a financial supporter of The Texas Tribune, a nonprofit, nonpartisan news organization that is funded in part by donations from members, foundations and corporate sponsors. Financial supporters play no role in the Tribune’s journalism. Find a complete list of them here.

Correction: An earlier version of this story listed state sales tax revenue incorrectly. The amounts are in billions of dollars.

Illustrations by Emily Albracht. Brandon Formby contributed to this report.