A Texas Growth Economy: From Shopping and Eating Out to Global Transport

By Greg Moses

As folks debate ways to pump the economy, November employment statistics remind us that

83 percent of nonfarm workers in Texas earn paychecks in the private sector.

Of the 10.7 million workers (nonfarm, not seasonally adjusted), 8.9 million are private

sector compared to 1.8 million government workers.

While it may be possible for government to pick up masses of workers to labor on roads,

bridges, and parks, or in emergency rooms, health clinics, and schools, there seems to be

obvious truth in the worry that this plan of action would raise taxes.

Still we should note that of the 32,700 net new jobs (actual, not seasonally adjusted)

added to Texas payrolls in November of 2008, at least 12,000 (or 37 percent) were added by

government, overwhelmingly at the local level.

Since there is no income tax in Texas, these jobs were funded by sales taxes and property

taxes. And while it does seem obvious that every new government job is to be counted as an

absolute increase in public tax burden, we’d like to remember some old sayings about ounces

of prevention.

After all, what sort of private sector employer is going to stick around very long in a

territory where taxpayers have pulled down their liabilities to zero by de-funding every

conceivable public service. Even the famous Laffer curve assumes that taxation has some

optimal rate.

From the point of view of civil rights development, it would be a cruel and unusual

economy that sets no public standards whatsoever to live by.

Nevertheless, let’s remember that 83 percent of the existing workforce in Texas does not

go to work for a government paycheck.

Now we’re going to leave aside the question of how many private workers depend upon a

government contract. So our KBR readers should not go around thinking that we ignore all

the public butter that gets spread on private bread.

But let’s go where the majority of workers live and try to prosper — in the private

sector.

It’s interesting in Texas that there are about as many workers in the “Goods Producing”

sector of the economy as there are in “Government” — about 1.8 million. But whereas the

government sector grew in November, the goods producing sector shrank (by about 6,000

jobs).

Not all parts of the goods producing sector lost jobs. In mining and oil and gas, about

a 1,000 new jobs were added.

Texas construction lost only a couple of hundred jobs, but the story would have been

worse if not for “Utility System Construction” which added 1,000 jobs. How much of that

private employment on utility systems depended upon public financing we’ll leave open to

further questioning.

Manufacturing, as you might guess, is still losing jobs in Texas. About 2,000 jobs were

lost in this sector during November, with losses in the wood, computer, and electronics

areas. We now have 924,800 manufacturing jobs left here.

It’s interesting to see that some sectors of manufacturing actually grew: “Fabricated

Metal Product Manufacturing” picked up 300 jobs; “Machinery Manufacturing” picked up 200

jobs; “Agriculture, Construction, and Mining Machinery Manufacturing” picked up 500 jobs;

“Transportation Equipment Manufacturing” picked up 500 jobs; and “Aerospace Product and

Parts Manufacturing” picked up 400 jobs.

No doubt there is some “public sector” contracting in these sophisticated heavy metal

operations in Texas, although I’m guessing we could wish for a healthier mix of “peace” to

“war” priorities.

When it comes to non-durable goods, Texas employed some 308,200 workers in November,

which is 700 fewer workers than October. It was a bad month for food (-400), plastics (-

200), and paper (-200). But a better month for animal slaughtering (+100) and products made

from petroleum and coal (+700) and chemicals (+200).

In the private sector, “Service” is the mammoth sector of the Texas economy. That’s

where 7.1 million workers were employed in November, an increase of 26,700 workers over

October. About 20,000 of those new jobs were split between clotting stores and department

stores. Another 5,000 jobs were added by “Other General Merchandise Stores.”

Information services fell by another 400 jobs, which is why you see more people like me

doing this grunt work for free (actually, the newspaper people are holding the line; nothing

lost, nothing gained).

In the “Finance and Insurance” sector, jobs are down slightly overall (-200), but there

is a growth niche in “Credit Intermediation,” which added 1,100 jobs.

In the professional services sector, lawyers, accountants, architects, and computer

experts are all finding fewer cubicles available.

Education and health care, on the other hand, are growing modestly; while “Leisure and

Hospitality” continue their slow decline.

In Texas, we are pleased to report, “Food Services and Drinking Places” are still “help

wanted” areas, with 2,500 new jobs added in November, 2008.

So if you want to help grow jobs in the Texas economy, especially if you’re a government

worker, go out and buy some new clothes, steer a shopping cart through your neighborhood

department store, and take the family out for dinner and drinks. And don’t forget to tip as

if it was your own salary you were figuring up.

Beyond these sorts of stopgap subsidies that we can share with each other, there do seem

to be some healthy fundamentals in the current economic profile in Texas, considering that

heavy machinery is growing jobs along with education and health services.

And when you think about all the experience that Texans accrue getting from one end of

the state to the other, why shouldn’t Texas step up to global leadership in the design,

management, and manufacture of transportation systems and services? Couldn’t we teach

ourselves to travel in ways that would prepare us to teach the world?

Oh, and remember not to shoplift. However, if you can look like you might be shoplifting could it create more jobs for security guards? Check out Grits for Breakfast on the shoplifting rate.

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