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Texas Service Sector Activity Strengthens Further, Says Dallas Fed Survey

Retail Sales Growth Improves Again in September

For Immediate Release: September 26, 2017

DALLASTexas service sector growth picked up slightly in September, according to the Federal Reserve Bank of Dallas’ Texas Service Sector Outlook Survey (TSSOS).

For this month’s Texas Business Outlook Surveys, business executives were asked supplemental questions on the impact from Hurricane Harvey. Results for these questions from the Texas Manufacturing Outlook Survey, TSSOS and Texas Retail Outlook Survey (TROS) have been released together.

The TSSOS revenue index—a key measure of state service sector conditions—edged up from 14.2 in August to 15.9 in September.

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 slightly longer workweeks this month. The employment index moved down a point to 3.5. The hours worked index fell to 2.7.

Perceptions of broader economic conditions reflected less optimism in September. The general business activity index dipped to 12.4. The company outlook index dropped to 7.7.

Respondents’ expectations regarding future business conditions reflected more optimism in September. The index of future general business activity rose from 21.3 to 28.0. The index of future company outlook moved up three points to 29.4.

Retail sales improved notably again in September, according to business executives responding to the TROS, which uses information from respondents in the retail and wholesale sectors only. The sales index surged 16 points to 32.8 in September, its highest reading in three years.

TROS labor market measures indicated slight employment gains and longer workweeks this month. The employment index edged up to 0.9. The hours worked index fell to 5.1.

Retailers’ perceptions of broader economic conditions reflected more optimism in September. The general business activity index jumped from 9.7 to 19.3. The company outlook index surged 14 points to 22.8.

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