Texas service sector activity continues to increase, says Dallas Fed survey

For Immediate Release: August 29, 2017

DALLAS—Texas service sector activity continued to reflect expansion in August but at a slightly slower pace, 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—edged down slightly to 14.2 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 about 8.5 million workers.

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

Labor market indicators reflected slower employment growth and longer workweeks this month. The employment index moved down three points to 4.6. The hours worked index was unchanged at 8.3.

Perceptions of broader economic conditions reflected more optimism in August. The general business activity index moved up from 10.5 to 15.1. The company outlook index advanced from 7.9 to 15.5.

Respondents’ expectations regarding future business conditions continued to reflect optimism in August. The index of future general business activity fell slightly to 21.3. The index of future company outlook rose three points to 26.2.

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 improved notably in August after falling last month, according to business executives responding to the Texas Retail Outlook Survey. The sales index surged 18 points to 16.9 in August.

Labor market indicators were mixed again this month. The employment index held steady at a reading near zero, suggesting retail employment was unchanged on net. The hours worked index advanced eight points to 11.3.

Retailers’ perceptions of broader economic conditions reflected more optimism in August. The general business activity index rose from 4.3 to 9.7. The company outlook index jumped from a reading near zero to 8.6.

-30-

Media contact:
Jennifer Chamberlain
Federal Reserve Bank of Dallas
Phone: (214) 922-6748
E-mail: jennifer.chamberlain@dal.frb.org