Texas economy still growing but at a slower rate
Add Axios as your preferred source to
see more of our stories on Google.
Texas' economy is expanding while more than 20 states are either in a recession or on the precipice of a downturn, according to an analysis from Mark Zandi, chief economist at Moody's Analytics.
Why it matters: The latest workforce numbers show Texas outpaced all other states in job growth over the last year, but that growth has slowed since rebounding sharply after the pandemic.
How it works: Zandi created an index looking at state-level jobs data, as well as other inputs, including modeled industrial production, personal income and housing starts, Axios' Emily Peck reports.
Zoom in: Texas added 17,600 jobs in August, per the Texas Workforce Commission's latest data.
- Houston is outperforming other Texas cities when it comes to job growth, Colin Baker, manager of economic research at the Greater Houston Partnership, tells Axios.
What they're saying: "Health care has been a bright spot for the U.S. labor market in 2025, and that is one place where Houston excels," Baker says.
- "Almost half of the jobs created in Houston during the previous 12 months have been in health care," he says. "Many of these new doctors, nurses and other healthcare professionals are providing care to the region's growing population."
The big picture: The state economies seeing slower job growth are more reliant on agriculture and manufacturing, sectors impacted by tariff increases, Zandi says.
- The immigration crackdown is also suppressing Texas' growth, per the Dallas Fed.
Yes, but: State leaders contend the state is still exceptional for its ability to create jobs as other states struggle.
- "Texas is America's jobs leader," Gov. Greg Abbott said last month. "With the best business climate in the nation and a skilled and growing labor force, Texas is where businesses invest, jobs grow and families thrive."
What to watch: New York and California, both in the "treading water" category, could decide which way the national economy goes.
The bottom line: "My takeaway is not that the economy is in recession, but it's pretty darn close," Zandi says.