Dallas Fed shows continued economic growth in El Paso, with some warning signs
Dallas Fed’s El Paso Business-Cycle Index hit another all-time high in November, primarily driven by payroll expansion in the education and healthcare services sector.
That sector added 1,050 jobs in 2019 through October in El Paso, according to the latest monthly report from the Dallas Federal Reserve.
The Dallas Fed produces monthly indexes for nine Texas metropolitan areas, including El Paso. “The indexes are constructed based on the aggregated movements in the local area unemployment rate, nonagricultural employment, inflation-adjusted wages, and inflation-adjusted retail sales,” according to the Dallas Fed. “The weights of the components are statistically optimized for each metropolitan area in order to best capture the underlying cyclical movements in the local area economy.”
The other major area of job growth for El Paso in 2019 has been in the construction and mining sector, which added 560 jobs through October. The biggest losses have been in trade and transportation, which has shed 830 jobs.
The Dallas Fed reports a mixed picture on housing sales in El Paso. Annual sales have declined by 3.5 percent through October, while the median home price has risen by 4.4 percent, to $163,635. “Tight inventories may be to blame for the weak sales and rising home prices. In October, inventories stood at 3.7 months, well below the six months of supply associated with a balanced market,” the Dallas Fed reported.
If the trend continues, rising housing prices will make it more difficult for a typical family to afford a home in El Paso, according to the Dallas Fed. Only 54 percent of the homes sold in El Paso in the third quarter of 2019 were considered affordable to a family earning the median income, compared to 63.6 percent nationally.