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February job growth was weaker in Houston than first thought, according to data released today by the Texas Workforce Commission (TWC). The agency previously reported a gain of 45,000 jobs but revised that downward to 32,000 in today’s report. February ’22 is now the fourth best on record for job growth, a testament to Houston’s healthy economy.
Revisions to employment data are common. TWC bases its monthly estimates on employer surveys and must account for incomplete and insufficient responses when modeling the results. Economists had expected revisions to the February data, the earlier report seeming too good to be true based on historic patterns and trends elsewhere in the economy.
Several sectors saw major downward revisions in Houston: retail created 3,500 fewer jobs than first thought; government, 3,000 fewer; administrative support, 2,700 fewer; restaurants and bars, 1,800 fewer; professional, scientific, and technical services, 1,100 fewer; and transportation, 1,000 fewer. One sector saw a significant upward revision, construction adding 1,300 more jobs than first reported.
Job growth was barely positive in March, creating only 1,700 jobs throughout the region. Just as February’s data was revised downward, there’s a strong possibility March’s will be revised upward. Other indicators—population growth, home construction, sales tax collections, the Houston Purchasing Managers Index—suggest the region is currently enjoying robust growth. Revisions to March employment will be available when TWC releases data for April on Friday, May 20.
February’s revisions and March’s weak job growth push back the date Houston can claim it has returned to pre-COVID employment levels. In February, the region needed just 16,700 jobs to return to February ’20 employment levels. Now Houston needs 28,000 to reach that benchmark.
Prior to COVID, Houston averaged 13,300 net new jobs in the month of March, suggesting March ‘22 could see as significant an upward revision as February ’22 saw a downward revision. In non-recession years, Houston typically adds 8,000 to 12,000 jobs in April and 10,000 to 13,000 in May. If Houston follows historic patterns, total employment should return to pre-pandemic levels next month.
Unlike jobs data, labor force data is not subject to revisions. Its shows Houston’s unemployment rate fell from 5.3 percent in February to 4.4 percent in March. The rates are not seasonally adjusted.
On an even more positive note, Houston’s civilian workforce, both adjusted and unadjusted, now exceeds pre-pandemic levels.
The current employment situation will be explained in greater detail in the April issue of Houston: The Economy at a Glance. The March issue can be found here.
Patrick Jankowski, CERP
Senior Vice President, Research
Metro Houston added 1,700 jobs in March
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