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Texas Service Sector Activity Strengthens Further in December, Says Dallas Fed Survey

For immediate release: December 29, 2015

DALLASTexas service sector activity increased again in December, according to the Federal Reserve Bank of Dallas’ Texas Service Sector Outlook Survey (TSSOS).

The revenue index—a key measure of state service sector conditions—rose from 10.3 to 15.2.

The survey is conducted monthly by the Dallas Fed to obtain a timely assessment of activity in the state’s service sector, which represents almost 70 percent of the state economy and employs close to 7.6 million workers.

Positive readings in the survey generally indicate expansion of service sector activity, while readings below zero generally indicate contraction.

The employment index edged up from 10.6 in November to 12.3 in December, while the hours worked index moved up 5 points to 6.6.

Perceptions of broader economic conditions continued to reflect optimism in December. The general business activity index held steady at 3.3 in December, and the company outlook index was similar to last month at 5.7.

Expectations regarding future business conditions reflected less optimism in December. Both the index of future general business activity and the index of future company outlook moved down but remained positive. Indexes of future service sector activity, such as future revenue and employment, also reflected less optimism this month.

TSSOS also includes a component called the Texas Retail Outlook Survey, which uses information from respondents in the retail and wholesale sectors only.

Retail sales increased in December, according to business executives responding to the Texas Retail Outlook Survey. The sales index advanced 8 points to 13.6 in December.

Retailers’ perceptions of broader economic conditions were mixed this month. The general business activity index fell 4 points to –4.9. The company outlook index remained positive but edged down to 3.1 in December. Indexes of future retail sector activity remained in solid positive territory in December.

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Media contact:
James Hoard
Federal Reserve Bank of Dallas
Phone: 214-922-5307
Email: James.Hoard@dal.frb.org