Texas Service Sector Activity Expands but at a Slower Pace in August, Says Dallas Fed Survey
For immediate release: August 30, 2016
DALLAS—Texas service sector activity continued to reflect expansion but at a slower pace in August than in July, 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—fell from 10.3 in July to 6.5 in August.
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 8.2 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 2 points to 5.8 in August. The hours worked index fell slightly to a reading near zero.
Perceptions of broader economic conditions were mixed again in August. The general business activity index reflected more pessimism, moving down from –1.3 to –5.0. The company outlook index reflected more optimism, edging up 2 points to 3.0.
Expectations regarding future business conditions reflected less optimism in August. The index of future general business activity declined from 10.1 to 2.8. The index of future company outlook fell slightly from 14.0 to 11.9. 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 fell in August, according to business executives responding to the Texas Retail Outlook Survey. The sales index retreated from 2.9 back into negative territory to –5.3.
Retailers’ perceptions of broader economic conditions worsened in August. The general business activity index fell sharply from a reading near zero to –11.8. The company outlook index plunged from 8.9 to –13.4.
However, indexes of future retail sector activity continued to reflect optimism this month.
Federal Reserve Bank of Dallas